Treasury Secretary Scott Bessent claimed Thursday the U.S. can "grow" its way out of $40 trillion in national debt. The math doesn't add up.
The U.S. is running a $1.9 trillion deficit—5.8% of GDP—while the economy is already expanding. Debt held by the public sits at 101% of GDP. Interest payments alone hit roughly $1 trillion annually.
The problem: today's deficit spending is propping up current growth. Cut the borrowing, and part of that growth vanishes.
AI may boost real production, but if it drives down prices, displaces workers, and suppresses wages, nominal tax revenues shrink while the debt load stays fixed in dollars. The economy gets more productive, but the debt becomes harder to service.
The real risk isn't that AI fails—it's that a deflationary AI boom collides with a debt system built on inflation. When that happens, the money printer turns back on.
Buy $BTC.
The U.S. is running a $1.9 trillion deficit—5.8% of GDP—while the economy is already expanding. Debt held by the public sits at 101% of GDP. Interest payments alone hit roughly $1 trillion annually.
The problem: today's deficit spending is propping up current growth. Cut the borrowing, and part of that growth vanishes.
AI may boost real production, but if it drives down prices, displaces workers, and suppresses wages, nominal tax revenues shrink while the debt load stays fixed in dollars. The economy gets more productive, but the debt becomes harder to service.
The real risk isn't that AI fails—it's that a deflationary AI boom collides with a debt system built on inflation. When that happens, the money printer turns back on.
Buy $BTC.