Latest news with #federaldebt
Wall Street Journal
7 hours ago
- Business
- Wall Street Journal
The Power of Positive Thinking about Deregulation
Economic growth was negative in the first quarter, government-imposed costs on trade have risen this year, federal debt continues to soar, stocks are richly priced relative to their earnings, and Congress is laboring just to prevent massive tax hikes scheduled for the end of the year. Yet equity investors keep expressing confidence in U.S. business. The Journal's Karen Langley and Krystal Hur report:
New York Times
20 hours ago
- Business
- New York Times
The Senate Should Let Trump's Bill Die
The rise of the federal debt over the past two decades has prompted countless warnings that the United States is approaching a fiscal reckoning, a day when the government won't be able to drink all it wants from the fountain of easy money. The more immediate danger is that the fountain keeps flowing. The fear of a future crisis is distracting attention from the problems that the government's dependence on debt is already causing. We, the people, are spending a staggering amount of money each year to borrow money. The interest payments on the federal debt now exceed the government's spending on the military. They are roughly equal to the annual cost of Medicare. The sum is more than the government spends on anything except Social Security. President Trump's 'Big Beautiful Bill' would deepen this profligacy, repeating the mistakes of the 2017 legislation on which it is based. Once again, Republicans are proposing to reduce taxation. Once again, they are proposing to force the government to borrow more to pay its bills. Once again, federal spending on interest payments would rise — and money spent on interest is money that can't be spent on other things. The government is on pace to pay more than $1 trillion to its lenders this year. The House version of Mr. Trump's bill, already approved by that chamber, would increase interest payments on the debt by an average of $55 billion a year over the next decade, according to the Congressional Budget Office. The increase alone is enough money to fully repair every bridge in the United States. The Senate is still working on its bill, but early signs suggest it may cost even more than the House version. America's debt cost is already a large expenditure and would rise further if Trump's budget bill passes. Under the House bill Annual Net Interest Current law $1.6 trillion Social Security $1.45 trillion $1.2 trillion Medicare $865 billion $800 billion Defense $855 billion Medicaid $618 billion $400 billion Projection '90 '00 '10 '20 '30 Under the House bill Annual Net Interest Current law $1.6 trillion Social Security $1.45 trillion $1.4 trillion $1.2 trillion $1 trillion Medicare $865 billion Defense $855 billion $800 billion $600 billion Medicaid $618 billion $400 billion $200 billion Projection '85 '90 '95 '00 '05 '10 '15 '20 '25 '30 Sources: Congressional Budget Office Social Security, Medicare, Medicaid and Defense costs are for 2024. Because the Trump administration and House Republicans have savaged the C.B.O.'s analysis, it is worth adding that Phillip Swagel, who heads the office, is a Republican reappointed at the behest of House Republicans just two years ago. At the time, they praised his 'objectivity and integrity.' The C.B.O.'s analysis closely resembles independent assessments by the Penn Wharton Budget Model, the Yale Budget Lab and the Tax Foundation. Want all of The Times? Subscribe.
Washington Post
6 days ago
- Business
- Washington Post
To fix the national debt crisis, Republicans need to raise taxes
There is a great deal of chatter about the staggering federal debt, service on that debt and ballooning deficits but little analysis about what to do about it all. I find that the discussion is too much about ideology and not enough about the data that ought to be driving arguments.
Yahoo
19-06-2025
- Business
- Yahoo
Elon Musk Warns US Faces 'De Facto' Bankruptcy If $37 Trillion Debt Not Tackled, Peter Schiff Says, 'We Are Already Bankrupt'
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Billionaire entrepreneur Elon Musk is once again raising concerns regarding the U.S. fiscal outlook, warning of dire consequences as interest on Federal debt balloons to unsustainable levels. What Happened: On Tuesday, in a post on X, Musk warned that the United States was teetering on the edge of 'de facto bankruptcy' as federal debt surpasses $37 trillion, and interest payments on this debt now accounting for 25% of all tax revenue. Quoting a post by popular X account, Wall Street Mav, Musk says that 'if this continues,' then all tax revenues will eventually go toward servicing the national debt, with 'nothing left for anything else.' Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — The quoted post highlights the gravity of the situation, stating that of the $5 trillion in total U.S. Government revenue, interest payments now account for $1.2 trillion, while the government continues to spend $7 trillion annually, resulting in persistent and ever-growing deficits. Economist Peter Schiff responded to Musk's post, saying that the U.S. is already bankrupt, and that it's 'just a matter of time before it's obvious to our creditors.' Schiff then warns that following this, 'interest rates will skyrocket to the point' where debt servicing costs will exceed total tax revenue. 'The Fed will unleash runaway inflation in an attempt to prevent that from happening,' Schiff said. Why It Matters: Last month, Deutsche Bank's Jim Reid warned that the U.S. faces 'death by a thousand cuts,' and gradual erosion of confidence if the fiscal situation is not rectified. Musk, who until recently headed the Trump administration's Department of Government Efficiency, or DOGE, called out the GOP's Budget Reconciliation Bill, for its tax cuts and 'massive, outrageous, pork-filled' spending package, referring to it as a 'disgusting abomination.' Recently, JPMorgan Chase & Co. (NYSE:JPM) CEO Jamie Dimon warned regulators and market participants of a looming dislocation, saying that 'You're going to see a crack in the bond market.' Read Next: Maximize saving for your retirement and cut down on taxes: Schedule your free call with a financial advisor to start your financial journey – no cost, no obligation. Arrived Home's Private Credit Fund's has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Photo courtesy: Joshua Sukoff / This article Elon Musk Warns US Faces 'De Facto' Bankruptcy If $37 Trillion Debt Not Tackled, Peter Schiff Says, 'We Are Already Bankrupt' originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
19-06-2025
- Business
- Yahoo
Elon Musk Warns US Faces 'De Facto' Bankruptcy If $37 Trillion Debt Not Tackled, Peter Schiff Says, 'We Are Already Bankrupt'
Benzinga and Yahoo Finance LLC may earn commission or revenue on some items through the links below. Billionaire entrepreneur Elon Musk is once again raising concerns regarding the U.S. fiscal outlook, warning of dire consequences as interest on Federal debt balloons to unsustainable levels. What Happened: On Tuesday, in a post on X, Musk warned that the United States was teetering on the edge of 'de facto bankruptcy' as federal debt surpasses $37 trillion, and interest payments on this debt now accounting for 25% of all tax revenue. Quoting a post by popular X account, Wall Street Mav, Musk says that 'if this continues,' then all tax revenues will eventually go toward servicing the national debt, with 'nothing left for anything else.' Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — The quoted post highlights the gravity of the situation, stating that of the $5 trillion in total U.S. Government revenue, interest payments now account for $1.2 trillion, while the government continues to spend $7 trillion annually, resulting in persistent and ever-growing deficits. Economist Peter Schiff responded to Musk's post, saying that the U.S. is already bankrupt, and that it's 'just a matter of time before it's obvious to our creditors.' Schiff then warns that following this, 'interest rates will skyrocket to the point' where debt servicing costs will exceed total tax revenue. 'The Fed will unleash runaway inflation in an attempt to prevent that from happening,' Schiff said. Why It Matters: Last month, Deutsche Bank's Jim Reid warned that the U.S. faces 'death by a thousand cuts,' and gradual erosion of confidence if the fiscal situation is not rectified. Musk, who until recently headed the Trump administration's Department of Government Efficiency, or DOGE, called out the GOP's Budget Reconciliation Bill, for its tax cuts and 'massive, outrageous, pork-filled' spending package, referring to it as a 'disgusting abomination.' Recently, JPMorgan Chase & Co. (NYSE:JPM) CEO Jamie Dimon warned regulators and market participants of a looming dislocation, saying that 'You're going to see a crack in the bond market.' Read Next: Maximize saving for your retirement and cut down on taxes: Schedule your free call with a financial advisor to start your financial journey – no cost, no obligation. Arrived Home's Private Credit Fund's has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate with just a $100 minimum. Photo courtesy: Joshua Sukoff / This article Elon Musk Warns US Faces 'De Facto' Bankruptcy If $37 Trillion Debt Not Tackled, Peter Schiff Says, 'We Are Already Bankrupt' originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
