Anxieties over America’s ballooning debt have reached fever pitch, but economists question whether Washington can muster the political will needed to avert a reckoning, and worry that the proposed remedies could carry their own set of fiscal ailments.
America’s national debt—now $39 trillion—has long alarmed fiscally hawkish lawmakers. Congressional Republicans on the Joint Economic Committee (JEC) recently labeled the country’s borrowing practices “unsustainable,” calling the failure to address them an “immoral” burden placed on future generations.
Those concerns have been echoed by influential voices in finance. Hedge fund billionaire Ray Dalio has warned of an imminent “debt‑induced heart attack,” while JPMorgan Chase CEO Jamie Dimon has described rising U.S. debt as one of two “tectonic plates,” alongside geopolitical volatility, that could destabilize the global financial system.
At the core of the concern is a simple dynamic: debt is growing faster than the economy, driving up interest costs and increasing the risk of a self‑reinforcing fiscal spiral. Treasury data show the U.S. paid $1.2 trillion in interest on the federal debt in the most recent fiscal year, a figure the Congressional Budget Office projects could rise to $2.1 trillion by 2036.
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By Hugh Cameron and Jasmine Laws |
Anxieties over America’s ballooning debt have reached fever pitch, but economists question whether Washington can muster the political will needed to avert a reckoning, and worry that the proposed remedies could carry their own set of fiscal ailments.
America’s national debt—now $39 trillion—has long alarmed fiscally hawkish lawmakers. Congressional Republicans on the Joint Economic Committee (JEC) recently labeled the country’s borrowing practices “unsustainable,” calling the failure to address them an “immoral” burden placed on future generations.
Those concerns have been echoed by influential voices in finance. Hedge fund billionaire Ray Dalio has warned of an imminent “debt‑induced heart attack,” while JPMorgan Chase CEO Jamie Dimon has described rising U.S. debt as one of two “tectonic plates,” alongside geopolitical volatility, that could destabilize the global financial system.
At the core of the concern is a simple dynamic: debt is growing faster than the economy, driving up interest costs and increasing the risk of a self‑reinforcing fiscal spiral. Treasury data show the U.S. paid $1.2 trillion in interest on the federal debt in the most recent fiscal year, a figure the Congressional Budget Office projects could rise to $2.1 trillion by 2036.
Read more: [https://www.newsweek.com/us-debt-panic-is-rising-the-proposed-solutions-could-backfire-11731691](https://www.newsweek.com/us-debt-panic-is-rising-the-proposed-solutions-could-backfire-11731691)
What debt panic? Where is the panic? I don’t see leaders within Washington panicking. They are complacent. They’re continuing to double down.