America has a debt problem. In fact, it has become so severe that, for the first time ever, Moody’s has downgraded America’s creditworthiness. With the passing of Trump’s so-called ‘Big Beautiful Bill,’ America, and its financial standing in the world, are in serious trouble. Let’s take a look at some of the major pitfalls of America’s current debt situation, and why this bill is so harmful not only in terms of fiscal policy, but to the wellbeing of everyday Americans.
Kickin’ the Can
One of the major problems in America’s war with its catastrophic debt is the shirking of responsibility by lawmakers, who continuously pass on record deficits to the next administration. In fact, the last time there was a surplus in the federal budget was under Bill Clinton nearly 25 years ago. Before that, it was under LBJ in 1969.
There have been many factors that have contributed to the debt problem in the United States over the years - endless wars in the Middle East, the Great Recession of 2008, and COVID, to name a few. However, it seems glaringly obvious that the primary reason is the penchant of the United States to irresponsibly and ceaselessly print money via the Federal Reserve. It was Nixon who officially took the United States off of the Gold Standard in 1971, meaning that the nation’s creditworthiness and the value of the dollar are hitched primarily to investor confidence in America’s ability to service its debt, and pay back its obligations on treasury bills.
Colossal amounts of US treasuries are held by foreign countries, with nations like Japan, the UK, and China serving as the largest creditors. Traditionally, this has worked to the advantage of the United States - nations have often seen treasury bills (also referred to as T-bills) and US bonds as a safe haven and stable investment. However, there have been recent indications that this sentiment has changed under Trump.
Following Trump’s announcement that his administration would be pursuing aggressive tariff policies as a means of ‘leveling the playing field’ of global trade, the administration faced a grave threat - the dumping of its debt held by foreign entities. If this were to happen, and other countries sold off US debt in large numbers, the potential for a debt crisis would become a near-certainty, resulting in higher interest rates at the Federal Reserve, and making it nearly impossible for America to meet its financial obligations. As it stands now, US debt is spiraling out of control, with the ratio of government debt to GDP sitting at a whopping 124%, the highest level since 2021, when the Biden administration administered record stimulus packages to businesses and individuals.
The situation becomes even more dire when considering that experts estimate that the United States will pay nearly $1 trillion USD just to account for interest payments in 2026, meaning that money from federal revenue will be siphoned away from services that millions of Americans rely upon, as well as programs and initiatives to ensure future growth and development. As any American who has a mortgage or credit card debt knows, interest payments, especially at high interest rates, are the real killer, limiting the amount of each payment that goes towards lowering the principal balance, and compounding over time.
A Big, Beautiful Mistake
Trump’s ‘Big Beautiful Bill’ is not just bad policy, it is an assault on the services and institutions that support millions of Americans. The bill, which is over 900 pages long, makes record cuts to Medicaid, SNAP, and programs like the Affordable Care Act (also know as ObamaCare), all of which serve as the lifeblood for a large portion of the citizenry. At the same time, the bill plays to the advantage of corporations and wealthy Americans, including tax cuts that will severely undercut revenues to the Federal government, exacerbating the issue of wealth distribution to the top 1% at a time when a majority of these entities avoids paying these taxes altogether.
The passing of this bill threatens to wrench away insurance from nearly 17 million Americans, the largest rollback in public healthcare in United States history. In addition to jeopardizing access to healthcare for individuals, the bill also entails massive cuts to Clean Energy programs, severely undercutting America’s progress in energy independence and dominance on the world stage. At the same time, China has invested trillions into renewable energy, with the Solar Industry cementing its place as the top beneficiary, and solidifying China’s status as the world’s preeminent hub for sustainable energy. Elon Musk, a key supporter and advisor to Trump, has stepped out to warn of the risk that the Big Beautiful Bill poses to the US Energy Industry, highlighting that by 2028, China’s solar output alone could surpass America’s total electric output, which is a combination of coal, fossil fuels, nuclear, and renewable energy sources. The implications are clear - the bill has the potential to decimate the United States in the global energy race, and will be detrimental to sustainable energy development for decades to come.
It is clear that Trump’s Big Beautiful Bill is a catastrophic mistake that threatens to impede US progress, and puts millions of lives at risk, all while benefitting America’s wealthy elites and alienating key partnerships with foreign nations.
An Unpopular Decision
Beyond the destruction to the financial standing of the United States, Trump’s Big Beautiful Bill has become the subject of ire for many Americans, who rightly view it as an assault on their rights and livelihood. At a time when Trump’s popularity is at record lows and the 2026 midterm elections are rapidly approaching, the bill could spell disaster for the Republican Party, too. A recent poll by Fox News shows that nearly 60% of voters disapprove, and the coordination of hundreds of protests on July 4th is already underway, with participants decrying the Republican Party’s ‘disregard for public health.’
This could very well be the defining moment of Trump’s second term, and could precipitate the beginning of the end for the president. Beyond the disastrous implications for the American public and future development, the passing of this bill could serve as the nail in the coffin, leading to landslide victories for Democrats in 2026, who have already made clear their intentions to seek a third impeachment.
The time to pay has arrived, and it looks like America, and the Republican Party, don’t have what it takes to rise to the occasion.
