U.S. Debt
Coverage of U.S. Debt in the Nexus archive.
- U.S. debt is a looming crisis today but was once its own revolutionary masterstroke that helped launch a global financial superpower
The U.S. debt, once a masterstroke under Alexander Hamilton's 1790 plan to consolidate Revolutionary War debts, established the nation's creditworthiness and financial power. Today, U.S. debt exceeds $39 trillion, raising concerns over sustainability as interest costs surge and fiscal policies remain unaddressed.
- This may be the maximum level of U.S. debt that’s sustainable before interest payments trigger a default crisis that even steep tax hikes can’t fix
The Penn Wharton Budget Model warns that U.S. debt exceeding 210% of GDP could trigger a crisis where even steep tax hikes cannot cover interest payments. Current debt is 100% of GDP, with projections reaching 175% by 2056, and healthcare cost growth could accelerate the threshold. A 15-percentage-point tax hike on labor income is proposed as a solution, but factors like higher interest rates and market instability could worsen risks.
- Gold is an awkward asset for central banks to hold. It’s now moved ahead of U.S. debt anyway.
Gold has surpassed U.S. debt as the primary reserve asset for central banks worldwide. The debt of the world’s biggest economy is no longer the leading reserve asset held by central banks.
- Manchin Warns of The Historic Rise of US Debt As Iran War Drags On
Senator Joe Manchin warns of a historic increase in U.S. debt due to the prolonged Iran War. The article highlights concerns about escalating financial commitments in the ongoing conflict.
- Jamie Dimon's warning: More geopolitical risk for America than since WWII
Jamie Dimon warns of unprecedented geopolitical risks for the U.S., comparing current threats to those since WWII, while highlighting AI-driven cyber risks and challenges like China, Russia, and U.S. debt. He emphasizes the need for business leadership in addressing societal issues amid political dysfunction.