The US approaches bankruptcy

Context

The US government just might be insolvent, or getting close to it. The US owns $6.06 trillion in total assets and owes $47.78 trillion in total liabilities as of September 30, 2025. That’s based on the Treasury Department’s consolidated financial statements for fiscal year 2025. This news was released last week. It elicited near-total silence from our mostly incompetent and complicit mainstream media.

Every year, the US Treasury quietly releases a report that reads like a slow‑motion horror story for public finances. In the latest Financial Report, debt held by the public sits around the size of the entire economy, roughly 99–100 percent of GDP, and is projected to climb far above its post‑World War II record if nothing changes. The Congressional Budget Office now expects federal debt to reach ~120% of GDP in the 2030s and keep rising after that. That’s before you even factor in the long‑term costs of Social Security, Medicare, and interest on the debt as the population ages. Link 1, link 2, link 3, link 4

A brief insolvency primer

A driver of how we got here is a deliberate political strategy called “Starve the Beast.” Since the late 1970s, radical right activists and conservative politicians, now MAGA authoritarians, have pushed the idea that you can force government to shrink by cutting taxes, even if the cuts blow holes in the budget. The theory was simple: if you deprive Washington of revenue, it will eventually have to slash spending. But in practice, the tax cuts went with higher spending. That created bigger deficits, not smaller government. The beast has been fed with borrowed money. Link 5, link 6

Behind this strategy is firmly entrenched wealth and power. That power is in wealthy donors, corporations, and networks that ideologically support or benefit from low taxes on capital and high‑end income while relying on the state for contracts, subsidies, and bailouts. These interests have corrupted the tax code, spending priorities, and budget deals in ways ordinary voters rarely see because its is rarely reported with coherence and clarity. Also, politicians lie about the problem all the time. Recent analyses by the Congressional Budget Office show that new budget laws usually reduce resources for households at the bottom while boosting them some the middle and a lot for the top. That pattern is no accident. It reflects who has the wealth-power in political decisions and policy. Link 7, link 8, link 9

Multiple analyses show that fiscal consolidations in advanced economies typically increase income inequality, especially when they lean on spending cuts rather than progressive taxation. Cuts fall on public services, and employment that matter most to the bottom and middle. At the same time, wealthy-powerful people and businesses work to shape tax changes to their advantage to minimize their pain. Link 10, link 11, link 12

So what happens when the herd finally spooks? That’s when wealthy investors and asset owners decide the numbers no longer add up and they stampede for the exits. History and international evidence suggest that when the bill for decades of easy deficits comes due, the pain usually falls hardest on people with the least wealth-power. Fiscal “consolidation” packages almost always cut public services, social benefits, and jobs that matter most to average households. Meanwhile those at the wealth-power top lobby our corrupted, endlessly money-hungry two-party system for protections for their tax breaks, portfolios and assets. Unless we change who writes the rules, the next fiscal crisis won’t just be about numbers. It will be about who gets sacrificed by how much to save a system they never controlled in the first place. Link 13, link 14

What about Trump and MAGA?

During Trump’s first term (Jan. 2017–Jan. 2021), the gross national debt rose from about $19.9 trillion to roughly $27.8 trillion, an increase of around $7.9–8.1 trillion (~40% increase). Analyses of his major policies estimate that the Tax Cuts and Jobs Act, bipartisan budget deals, and other legislation he approved collectively added about $8.8 trillion in new ten‑year borrowing to the debt trajectory. Link 15, link 16

Peanut gallery commentary

Peanut 1: Don’t worry deficits will be a big fucking deal again the next time a democrat is in office when all of a sudden government spending matters once again. I’m 40 have have seen this GOP hypocrisy game play out for my entire life.

Peanut 2: Me too and I’m 73.

Peanut 3: I’m 50, same here. I think the deficit really grew out of control and passed $1 trillion during Reagan admin. I'd love to never hear that "fiscally responsible" lie from Republicans again, but I know it'll never go away.

Peanut 4: The trickle down will happen any day now!

Peanut 5: It has been happening. But by "trickle down" they really mean golden shower.

Germaine: Nah, they really mean road apples.

Peanut 6: There won’t be another Democrat because the American experiment has failed.

☠️