For as long as I’ve been aware, the United States has been over $20 trillion in debt. However, the US is still the richest country on the planet and manages to keep the vast majority of its people off the streets. And as far as I know, this number is only increasing with time. So then why does it even matter?
In: Economics
It only matters if a country is in danger missing a payment on that debt.
Debt is an important tool, it allows you to borrow money and build a bridge sooner and enjoy the economic benefits of that bridge sooner. If that benefit exceeds the interest on the loan, that is a win. It is pretty much the same as borrowing several times your income or net worth to buy a house.
In the case of the US, if it enjoyed $30 trillion worth of benefit from the $20 trillion of debt, they are coming out way ahead. When a country uses debt irresponsibly, like Venezuela or Greece, they don’t get any long term benefit out of it, and eventually reach a point where they are unable to repay that debt. They usually have to borrow more money to make their payments, and at that point the debt spirals out of control.
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