Elon Musk doesn't shy away from big ideas or bold predictions, but his latest warning is a wake-up call for America.
During a recent appearance on The Joe Rogan Experience, Musk pulled no punches when discussing the U.S. economy. His verdict? The country is heading toward financial collapse if drastic action isn't taken.
"We're drowning in debt," Musk said, referring to the $36.14 trillion the U.S. owes, as reported by the Treasury Department. He explained that interest payments alone comprise 23% of all federal revenue. "If this keeps up, the entire government budget will go to paying interest. That means no money for Social Security, no Medicare, nothing. America would be toast."
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Musk's warning hit a nerve and for good reason. Interest payments on the debt are already skyrocketing. In 2024, the government spent over $1 trillion on interest – a staggering figure compared to $4.92 trillion in total revenue.
The Congressional Budget Office predicts those payments will keep climbing, potentially outpacing Medicare and defense spending within a decade.
Musk didn't stop at identifying the problem; he proposed a solution: cutting federal spending by 30%. However, not everyone thinks that's realistic. Marc Goldwein, an expert from the Committee for a Responsible Federal Budget, quickly critiqued Musk's suggestion.
"Cuts of that magnitude would be borderline impossible without touching programs like Social Security or causing severe economic pain," Goldwein said. He added that most of the federal budget is tied to mandatory spending, leaving little room for discretionary cuts.
Ever the skeptic, Joe Rogan asked Musk how this would impact everyday Americans. Musk didn't sugarcoat it. "It means inflation will spike, jobs will disappear and systems we rely on will collapse," he said. "This isn't some far-off possibility – it's already starting to happen."
Experts are divided on Musk's approach but agree the debt crisis is serious. According to the Peterson Foundation, unchecked debt could lead to higher interest rates, slower economic growth and lower household incomes.
"This isn't just about government budgets," their recent report stated. "It's about the economic future of every American family."
Meanwhile, Treasury Secretary Janet Yellen has warned Congress that the U.S. could hit its debt ceiling as early as January 2025. In a letter reported by The Associated Press, Yellen urged Congress to take immediate action to protect credit and the full faith of the USA.
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