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
As long as the country can pay off its debt when it comes due, there isn’t much of an issue. The risk is that should the economy plummet to a point that when the bonds come due, the country doesn’t pull in enough revenue to pay for them, it would default on those loans, causing its credit rating to drop. This would lead to them having to raise interest rates to sell their bonds, thus more debt and more liability and less revenue for government-sponsored programs.
Latest Answers