This week, the U.S. national debt surpassed $35 trillion for the first time ever. Moreover, America has added around $12 trillion in federal debt since 2020.
To put it into perspective, the U.S. has added an average of $280 billion of federal debt every month since January 2020.
The country now has around $105,000 in federal debt for every person living in the United States, observed the Kobeissi Letter on July 30 before asking, “How can this possibly end well?”
Skyrocketing National Debt
Leading presidential candidates Kamala Harris and Donald Trump have said very little about the nation’s huge deficits while campaigning, which suggests that debts will continue to escalate over the next four years.
According to usdebtclock.org, federal debt is projected to hit a whopping $46 trillion by 2028. The Kobeissi Letter commented on the crisis:
“Every year, there are calls for spending cuts and they never happen. The debt ceiling crisis never truly ended, it was simply swept under the rug.”
BREAKING: Total US Federal debt has officially hit $35 trillion for the first time in history.
Since 2020, the US has now added ~$12 TRILLION in Federal debt.
In other words, the US has added an average of ~$280 BILLION of Federal debt EVERY MONTH since January 2020.
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— The Kobeissi Letter (@KobeissiLetter) July 29, 2024
According to the Congressional Budget Office, national debt is poised to top $56 trillion by 2034, as rising spending and interest expenses outpace tax revenue.
Social Security and Medicare spending, coupled with persistently high interest rates, have made it difficult to reduce America’s debt mountain.
Michael Peterson, chief executive of the Peter G. Peterson Foundation, which promotes fiscal restraint, told the New York Times, “We can’t keep pretending this is not a problem.”
“The election is less than 100 days away, and we’re projected to add another $1 trillion more in debt even during this short period.”
Bitcoin Is The Answer … Or Is It?
There has been a lot of talk about a strategic Bitcoin reserve to back the US dollar with both independent presidential candidate Robert F. Kennedy Jr. and Senator Cynthia Lummis proposing such systems recently.
On July 30, the Wyoming senator said:
“A strategic Bitcoin reserve could stop this runaway train and help pay down the national debt for our future generations.”
Today, the national debt has passed a staggering $35 trillion. A strategic Bitcoin reserve could stop this runaway train and help pay down the national debt for our future generations.
— Senator Cynthia Lummis (@SenLummis) July 30, 2024
Bitcoin adoption solutions firm JAN3 observed that the debt figure is 1.6 million times the size of the total Bitcoin supply.
“The end of fiat is imminent,” it stated before adding, “A Bitcoin Strategic Reserve is needed more and more with every passing moment.”
However, using BTC to reduce national debts would likely involve liquidating the asset, which the US government has already been doing this week. As we can observe, moving small amounts of the asset can cause big waves for crypto markets.
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