Another metric indicating that Joe Biden’s presidency was one of the worst in U.S. history dropped on Friday.
According to the Federal Reserve Bank of New York, Americans continue to rack up debt, owing $1.21 trillion on their credit cards as of the fourth quarter of fiscal 2024, the Washington Times reported, citing the data.
This marked a $45 billion increase from the third quarter of 2024 and an $82 billion (7.3%) rise year-over-year, according to a report from the New York Federal Reserve.
Credit card debt surpassed the trillion-dollar threshold for the first time in 2023. With over 600 million active accounts, credit card loans remain the most common form of consumer debt.
“Stubborn inflation has shrunk a lot of Americans’ financial margin for error from slim to about none, forcing people to lean more heavily on credit card debt,” Matt Schulz, Lending Tree chief credit analyst, told CNBC.
Credit cards are one of the most expensive ways to borrow money, with the average interest rate on a new card exceeding 20%, according to CNBC.
Overall, Americans owe more than $18 trillion in total debt, the New York Federal Reserve reported Thursday. Of that amount, $12.6 trillion is tied to mortgages, $1.65 trillion to auto loans, $1.61 trillion to student loans, and $1.21 trillion to credit card debt. The remaining balance comes from home equity lines of credit and other forms of borrowing.
Among these categories, mortgage debt saw the largest year-over-year increase. While mortgage balances grew by $11 billion from the third quarter of 2024, they surged by $353 billion compared to the fourth quarter of 2023.
Debt delinquency remains a significant concern. In the fourth quarter of 2024, over 7% of all American credit card debt became seriously delinquent, meaning payments were overdue by 90 days or more. Additionally, approximately 1.09% of mortgage debt and nearly 3% of auto loan debt also reached serious delinquency during the same period, the Times reported.
According to the Fed bank’s report, over 10% of all credit card debt in the United States and nearly 5% of all mortgage debt are seriously delinquent. Additionally, approximately 3.6% of all American debt is overdue, which includes both debts that are less than 90 days overdue and those that are more than 90 days overdue.
The number one issue that propelled Donald Trump to the White House last year was the poor state of the economy. Under Biden-Harris, inflation fell from recent record highs but remained far above average throughout their term. Groceries, fuel prices, utilities, interest rates, and insurance premiums all rose dramatically during the previous administration.
To that end, Trump must reverse the Biden-Harris trend of higher-than-average inflation, but he’ll need help from the GOP-controlled Congress which, thus far, is not moving fast enough on that agenda, according to a leading Republican voice.
Former House Speaker Newt Gingrich appeared on the Fox Business show “Kudlow” last week where he told host Larry Kudlow that “there’s a lot at stake” in 2026 if majority Republicans don’t quickly pass the Trump economic agenda of tax cuts and other incentives.
“Almost guarantee losing the Republican House next year and ruining the last two years of President Trump’s term with Hakeem Jeffries playing the Nancy Pelosi role, investigations, blocking programs, potential impeachments,” Gingrich said.
“I mean, there’s a lot at stake here, and it frankly mystifies me as to how House and Senate Republicans can’t understand you’ve got to plan back from victory,” he said.
He said that by June, Republicans must have legislative victories on issues like tax cuts, deregulation, and energy affordability.
“The victory here is winning in November of 2026. That requires a very strong economy. That requires a very strong tax cut deregulation, a pro energy affordability bill, certainly no later than May or June. And I cannot understand these guys, you know, I lived through it,” he said.
Gingrich also warned of the lessons from history that happened to previous administrations during midterm elections.
“Reagan lost 26 seats in the first off-year election because his tax cuts didn’t go into effect until 1983. Trump lost 42 seats in his first off-year election because the tax bill didn’t pass until October,” he said. “When I hear senators saying cavalierly, ‘Oh, we’ll pass the easy bill early, and we’ll get around to the other bill by October.’ They’re talking about killing the chances of keeping the House Republican.”
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