US national debt reaches a record $37T, the Treasury Department reports

Debt metrics, history & what’s driving it

• Commenters link to FRED / USAFacts charts of debt and deficit as % of GDP, noting:
  • Major jumps from the 2008 financial crisis and COVID, likened to “one-time war injuries.”
  • Debt/GDP fell after WWII and stayed relatively controlled until the early 1980s, then trended up.
  • Pandemic-era debt didn’t really “go down” afterward; GDP and inflation made ratios look better.
• Some emphasize the distinction between:
  • Gross federal debt vs. debt “held by the public.”
  • Intragovernmental holdings (e.g., Social Security) vs external creditors.
• Several argue the key constraint isn’t solvency but inflation and currency credibility.

Role of parties, administrations & current policy

• Strong partisan back-and-forth:
  • One side argues Republican administrations drive larger deficits (tax cuts, wars, BBB, tariffs), with Democrats more often stabilizing or reducing deficits.
  • Others insist “both parties are the same” and no one is serious about fixing debt.
• Some praise 1990s fiscal discipline and surpluses; others say this was mostly luck (Cold War peace dividend, asset bubbles) and regressive welfare cuts.
• There is criticism of current leadership’s transparency, fiscal priorities, and frequent turnover in economic posts.
• Debate over claims that allies’ public and private assets are being treated as an American “sovereign wealth fund”; some take this seriously, others call it economic nonsense or pure PR spin.

GDP, productivity & measurement skepticism

• Multiple comments question GDP as a denominator:
  • Growing shares from healthcare, finance, and services may distort “real” productivity.
  • Examples highlight how high wages inflate measured productivity without more real output.
• Some compare US to other countries (EU, Japan, developing nations) to illustrate how productivity statistics can mislead.

How does it end? Default, inflation, austerity?

• Scenarios discussed:
  • Slow drift into a “deficit spiral,” forced austerity, and/or wealth-destroying inflation.
  • Eventual explicit or implicit default (via monetization), with one cited model giving ~20 years.
  • Others counter that a monetary sovereign like the US can always roll debt or have the central bank buy it; the real risk is inflation and currency devaluation, not outright default.
• Many expect political choices to favor:
  • Benefit cuts over taxing the rich.
  • Continued high military spending and use of tariffs (seen as hidden taxes).
• Some foresee severe social breakdown, authoritarian drift, or even “failed state” dynamics; others see a long runway while the US retains reserve-currency status and military dominance.

Geopolitics, de-dollarization & external holders

• Concern that BRICS de‑dollarization, trade conflicts, and alienating allies could erode demand for Treasuries and weaken the “exorbitant privilege” that makes high US debt sustainable.
• Discussion of who holds Treasuries (allied governments, domestic institutions, Social Security) and whether they are “captive” buyers, complicating free-market assumptions.

Next crises & systemic risks

• Climate change repeatedly named as the major ignored “tail risk,” with particular focus on:
  • Collapse of property insurance in high-risk states.
  • Knock-on effects on mortgages, MBS, and local tax bases—likened to a climate-driven version of 2008.
• Some tie stock market strength and the S&P 500 to:
  • Massive fiscal and monetary support.
  • Concentration in AI/GPUs and forced retirement flows.
• There is scattered talk of radical “reset” ideas (e.g., seizing stock exchange wealth), generally not taken seriously.

Politics, polarization & discourse quality

• Several comments lament extreme polarization and “us vs. them” framing, in the US and abroad.
• Some argue debt-hawk rhetoric is kayfabe: one party campaigns as fiscally conservative but expands debt in practice.
• Meta-complaints that the thread devolves into snark and anti‑Trump venting instead of technocratic analysis highlight frustration with the state of online and political discourse itself.