Amid rising national debt and high interest payments, experts discuss the future of the US financial system and its impact on economic policy.
High Interest Payments
According to Treasury Department data, the US government spent approximately $1.2 trillion on interest payments in the 2024 fiscal year. This accounts for nearly a quarter of its total tax revenue of $5 trillion. Such interest expense now exceeds even national defense expenditures, raising concerns among economists.
Inflation Concerns
Economists expect the Federal Reserve to keep interest rates unchanged. However, in light of tariff increases and economic uncertainty among consumers, they continue to monitor inflation expectations. Despite recent mild inflation data, opinions among specialists suggest consumers are still uncertain about price control.
Economy and Debt Amid Global Trends
Historian Niall Ferguson emphasizes that when debt service costs exceed defense spending, it places a country in a risky position. The US is currently violating this rule, jeopardizing its financial stability. Ferguson predicts that many great powers that pursue such fiscal policies eventually face financial collapse.
Given the rising concerns about inflation and the significant national debt, experts call for careful analysis of the current economic situation in the US and potential future implications.
