London Daily

Focus on the big picture.
Thursday, Jul 03, 2025

Does The National Debt Matter? | What's Next For The U.S. Economy

With the national debt surging past $26 trillion, we asked top economists, analysts and policy makers why the deficit matters. Paul Krugman said the deficit doesn't matter too much and said instead the great danger is that America spends too little.
Danielle DiMartino Booth countered by saying such a large debt puts U.S. sovereignty at risk and Congress needs to step up. Mohammed El-Erian said we need to win the war against the threat of a global depression and secure economic peace by creating lasting and effective policy. Robert Reich thought now is just not the time to worry about the national debt. Watch the video to hear more.

Many arguing against aggressive stimulus spending from the federal government cite one critical reason: the national debt. Now totaling over $26.7 trillion, the U.S. debt-to-GDP ratio is one of the highest in the world.

Top economics and policymakers, however, are not concerned.

When asked about the staggering number, Nobel laureate Esther Duflo told CNBC, “That is not something that the general public should be worried about for the time being at all.” She continued, explaining that American credit is one of the safest assets to hold, so in a sense, it is unlikely that the government will ever have to repay this debt.

AFL-CIO chief economist William Spriggs asked us to consider if the national debt is creating money for real economic activity. If so, like in an example where a company or governmental agency takes out a loan to build a factory thus creating jobs, then there should be no reason for alarm.

Former Labor Secretary Robert Reich feels now is not the time to be worried about the national debt for exactly the reason Spriggs mentions. “When you have this much unemployment, when you have this much-underutilized capacity; this is the time when the government has got to be the spender of last resort,” he said.

Although Nobel laureate Paul Krugman was not impressed with the current choices of government spending, he was not concerned with the spending itself. He said “even though we’ve been running budget deficits that are kind of stupid, if you were going to run budget deficits, you should be using the money to build infrastructure to help education, to work on the future. And instead, we’ve been using it to get big windfalls to corporations and rich people.”

When looking at instances where the government bails out private sector companies, take for example the $25 billion in payroll grants for the Airline industry, Dambisa Moyo argued for more collaboration between the private and public sectors to combat the growing size of the government.

Jim O’Neill did see the deficit as a problem in the long run and suggested solving the national debt crisis by giving the Federal Reserve a different target than low inflation. Danielle DiMartino Booth maintained that targeted government spending is necessary for economic recovery but worried that such an expanding debt could leave the U.S. vulnerable to bad actors in the long run.

Watch the video to learn more about why some economists think the national debt may not matter.
Comments

John 5 year ago
Scary that they say it does not matter. Dr Skidmore and his students using numbers supplied by the US goverment have found another 21 trillion missing from DOD and HUD, so add that to the 26 trillion plus all the infunded debt like madicare etc. China has been dumping its US bonds and cash as of later and buy a huge amount of commodities, they see where the USD is headed and with the amount of gold China holds maybe they plan to go into a gold backed basket of currencies, thus crushing thr USD as a world reserve currency. The US says they have gold but have not allowed a audit since the 50s. Many say it is now just gold plated tungsten. Nixon screwed America in 1971 when he closed the gold window. And the US screwd itself in 1913 when it gave 6 jewish owned banks the right to coin US money. They called themselves the FEDERAL RESERVE, nice name to make it sound like its the government but the Fed is as Federal as Federal Express. Zimbabwe and Venezuela and the Weimer Republic all tried to print their way out of depression and we know how that has turned out for them.. The only real no counter party risk currency in the world is gold. Got yours yet?

Newsletter

Related Articles

0:00
0:00
Close
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
Poland Implements Border Checks Amid Growing Migration Tensions
Political Dispute Escalates Between Trump and Musk
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
US Senate Votes to Remove AI Regulation Moratorium from Domestic Policy Bill
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
Jury Deliberations in Diddy Trial Yield Partial Verdict in Serious Criminal Charges
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
King Charles Plans Significant Role for Prince Harry in Coronation
Two Chinese Nationals Arrested for Espionage Activities Against U.S. Navy
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
Trump Administration Considers Withdrawal of Funding for Hospitals Providing Gender Treatment to Minors
Texas Enacts Law Allowing Gold and Silver Transactions
China Unveils Miniature Insect-Like Surveillance Drone
OpenAI Secures Multimillion-Dollar AI Contracts with Pentagon, India, and Grab
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Elon Musk Critiques Senate Budget Proposal Over Job Losses and Strategic Risks
Los Angeles Riots ended with Federal Investigations into Funding
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Education Secretary Announces Overhaul of Complaints System Amid Rising Parental Grievances
Massive Anti-Government Protests Erupt in Belgrade
Trump Ends Trade Talks with Canada Over Digital Services Tax
UK Government Softens Welfare Reform Plans Amid Labour Party Rebellion
Labour Faces Rebellion Over Disability Benefit Reforms Ahead of Key Vote
Jeff Bezos and Lauren Sánchez Host Lavish Wedding in Venice Amid Protests
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
North Korea to Open New Beach Resort to Boost Tourism Economy
UK Labour Party Faces Internal Tensions Over Welfare Reforms
Andrew Cuomo Hints at Potential November Comeback Amid Democratic Primary Results
Curtis Sliwa Champions His Vision for New York City Amid Rising Crime Concerns
Federal Reserve Proposes Changes to Capital Rule Affecting Major Banks
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Trump Escalates Criticism of Media Over Iran Strike Coverage
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
Big Four Accounting Firms Fined in Exam Cheating Scandal
NATO Members Agree to 5% Defense Spending Target by 2035
Australia's Star Casino Secures $195 Million Rescue Package Amid Challenges
UK to Enhance Nuclear Capabilities with Acquisition of F-35A Fighter Jets
×