The US economy is facing a bleak 12 months as national debt threatens to wreak untold damage, an expert has warned.
Dr Dave Brat, who works at Liberty University’s business school, also suggested state intervention had inflated America’s economic situation as the US is now on the precipice of disaster.
Washington posted a budget deficit just shy of $1.7trillion in the fiscal year of 2023.
The figure represented a 23 per cent jump compared to the previous year.
WATCH NOW: Dr Brat on the US economy
Such an increase comes as US President Joe Biden continues to ask Congress for $100billion in new foreign aid and security spending, including $60billion to Ukraine and $14billion to Israel.
Dr Brat told GB News: “I think, you know, everyone over here has said we're going to have a credit event, likely in the commercial real estate sector, because they run on five year debt.
“Well, after COVID, we're two to three years in already.
“That's being recycled. Interest rates are going to keep going up.
“The US Government is having to recycle $8trillion in debt this year, right?
Joe Biden listens to a question from a reporter after speaking at an event about the economy, at the White House in Washington
“We're $33trillion in debt, $8trillion is going to go from zero per cent.
“I'm exaggerating a bit from very low interest rates up to that five per cent, that's going to be staggering, right?
“If you want to do just a simple math on the US, according to CBO, we're $50trillion in debt in 10 years.
“And so at a five per cent interest rate, which you guys [the United Kingdom] are at and which we're at right now, five per cent on $50trillion is $2.5trillion just in interest payments per year.”
People walk through the morning rain by the New York Stock Exchange (NYSE)
Brat, who represented Virginia’s seventh district in the US House of Representatives, added: “When I was in Congress, the entire budget wasn't $5trillion. So over half of a national budget is going to be spent on interest payments alone, three times our defence budget.
“And so that clearly is not sustainable, right?
“We have to end it by then. It's just a matter of how much damage we want to inflict in the short run.”
But Brat’s former Republican colleagues have been unable to halt Biden’s push towards raising the debt ceiling.
Former House Speaker Kevin McCarthy was blasted by Grand Old Party figures and later became the first ousted presiding office to get ousted from the chair after striking a deal with the US President.
Joe Biden delivers a prime-time address to the nation about his approaches to the conflict between Israel and Hamas
Biden’s administration has pushed ahead with a number of expensive public programmes in an attempt to alleviate the pressures facing Americans during the cost-of-living crisis.
The 80-year-old Commander-in-Chief, who is running for re-election in 2024, unveiled a $1.9trillion stimulus bill called the American Rescue Plan Act.
The Build Back Better Plan also included a $2trillion pot to spend on improving the nation’s infrastructure.
The financial services firm Goldman Sachs also estimated Biden’s Inflation Reduction Act costs around $1.2trillion.