The US debt problem or any other countries debt problem for that matter isn’t hard to understand, it’s basic math.
You spend more than you make you sink into debt.
Unless you magically grow your income or cut your expenses, that debt is definitely going to pile up. The real problem behind is also not luck of understanding of math, as there are geniuses in power or behind power, I believe it’s the politics. Both parties know what to do.
Raise taxes (as they already have been doing for years) and cut spending (which they rarely do but do the opposite of raising spending). That’s how you fix a deficit plain and simple. In fact if you cut spending on the unnecessary for a short while without raising taxes, you get a similar positive effect in the long run.
It’s been the same formula since forever.
But we’re at a point where politicians can’t even say that without their own voters losing their minds. If you’re a Republican and suggest raising taxes, you’re branded a traitor. If you’re a Democrat and talk about cutting spending, same thing, your own side kicks you out.
So the solution exists but nobody’s allowed to touch it. That’s why Ray Dalio, the founder and former CEO of hedge fund Bridgewater Associates calls it a tragedy.
To me, that's a tragedy.
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He made that claim on Monday (yesterday 30th June 2025) and I don't think he’s was just talking about numbers, the system is locked up.
Completely frozen by fear of backlash.
It doesn’t even matter if you sit down with the smartest economists or budget experts, because at the end of the day politicians care more about keeping their jobs than fixing the math. And if you think this is just theory, look at what’s happening with Musk. The guy backed Trump helped him with the so-called cost-cutting office (DOGE) now he’s publicly roasting Trump’s latest bill for being bloated with spending.
You can’t make this up.
It shows you how even the supposed fiscal hawks end up pushing debt higher when it’s politically convenient. Dalio’s been saying this for months, sooner or later the debt problem won't be just numbers on a spreadsheet, you will see the effect on the economy, interest rates, markets, and yeah even your job. But nobody’s got the spine to fix it, because fixing it gets you fired.
That’s where we are.
Credit:
My thumbnail image was generated using Chatgpt and the X link was taken directly from Dalios X account. Have a nice day.
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