This summer, the United States' public debt crossed an unprecedented threshold: $40 trillion. It remains the world's largest debt in absolute terms. The milestone reportedly arrived sooner than expected, driven by inflation: higher rates are said to have pushed up borrowing costs for the US government.
Does the United States really carry the world’s heaviest debt?
It’s a question people ask often, and the answer is straightforward: in absolute terms, the United States carries the highest public debt on the planet.
It's a question people ask often, and the answer is straightforward: in absolute terms, the United States carries the highest public debt on the planet. That record is measured by the total amount borrowed by the US government, which exceeds that of any other country, not by a ratio weighed against the size of its economy.
This puts the United States at the top of the global ranking by value, without settling how heavily that debt actually weighs on the American economy. It's this record in absolute terms that is the starting point for this third instalment of our Debt Price series, not a calculation of proportion.
What does the $40 trillion threshold actually change?
This summer, the United States’ public debt crossed an unprecedented threshold: $40 trillion. It’s a symbolic milestone, one that confronts the world’s leading economic power with the sheer scale of its debt.
This milestone doesn't, in itself, upend the country's budgetary mechanics, but it does set a clear marker: that of a debt still growing beyond a threshold never reached before. For the United States, $40 trillion is an entirely new order of magnitude.
Why did this milestone arrive sooner than expected?
Among the explanations put forward for this early milestone, inflation reportedly tops the list. It is said to mechanically inflate the cost of servicing the debt: higher prices call for higher interest rates, and so heavier borrowing costs for the US government.
This reading is put forward as the main explanation, though the full mechanism isn't spelled out in detail. It suggests that rising prices alone sped up the timeline for a threshold that had been expected much later.
What stands out, at the end of this third instalment, is the speed at which this threshold was crossed, earlier than expected, driven by inflation that is said to have pushed up the cost of public borrowing. America's record is measured in value, not in proportion.
Read also on La Sultane
After the World Cup: the FTF, a mirror of Tunisia’s crisis
Glam & Goodies Mini Market: the pop-up spotlighting Hammamet’s creators
Harry Styles crosses the Berlin Marathon finish line in under three hours
Chery Arrizo 8: the new premium saloon causes a sensation in Tunisia
