US government debt is now the highest in history; it's more than $34 trillion, and that number keeps climbing

US government debt is now the highest in history. It's more than $34 trillion, and that number keeps climbing, per BI.

Former Treasury Secretary Steven Mnuchin remarked that a robust dollar currently benefits the U.S. by facilitating the financing of substantial fiscal deficits, but he urged the victor of the November presidential election to spearhead a new effort to reduce the federal debt burden.

Mnuchin expressed his approval of the dollar's strength, noting its status as the world's reserve currency, which has enabled the U.S. to fund sizable deficits. Over the past year, the dollar has appreciated around 13% against the Japanese yen and has made smaller gains against other major currencies. The confidence in the dollar's stability over time has bolstered demand for U.S. Treasuries, the largest and most liquid bond market globally.

During his tenure under former President Donald Trump, Mnuchin occasionally advocated for a weaker dollar to enhance America's trade position. However, he acknowledged the challenges posed by an overly strong dollar, stating in July 2019 that while a strong dollar was beneficial in some respects, it made competition more challenging.

Looking ahead, Mnuchin emphasized the need to address the U.S. financial situation, cautioning that reliance on a strong dollar to support demand for U.S. federal debt is not sustainable in the long term. He suggested that the next president should collaborate with Congress to tackle the budget deficit, which the Congressional Budget Office projected to reach $2.56 trillion by 2034, up from $1.58 trillion this year.

Mnuchin, now heading the private investment firm Liberty Strategic Capital, proposed the establishment of a bipartisan commission to address the growing deficits. He also expressed concerns about the enforcement of sanctions on Russian and Iranian oil, advocating for stricter implementation. Additionally, he suggested considering the use of frozen Russian funds to aid in the reconstruction of Ukraine post-war, highlighting the importance of a robust discussion on this matter.