Today is a record moment in US history. The total national debt has surpassed $22 trillion for the first time ever.
The runaway mountain of debt is a terrifying reminder of how fragile the fiat monetary system is. If you want to watch it pile up in real time, visit the US debt clock. It’s a sobering vision of a system out of control.
This is why bitcoin matters. Bitcoin, with its fixed supply and anti-inflationary policy, is an antidote in waiting.
The national debt jumped $30 billion in the last month alone. In total, the US racked up more than $1 trillion worth of debt in the last year.
The debt has spiraled since Donald Trump introduced his $1.5 billion tax cut plan last year. However, we should point out that Obama was a much worse offender. The national debt doubled under his presidency.
This isn’t the fault of any one president. It’s the fault of an economic system that is slowly failing us.
Although many will maintain the economy is booming, this is a car crash coming in slow-motion. As Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities explained to CNBC:
“Even if you think that public debt just doesn’t matter to economic outcomes, the thing you have to admit is that when we hit a downturn, governments are less likely to take significant steps if the debt is as high as ours is now.”
When the next recession comes (and it will), the US will find it much more difficult to pay back the debt. And they’re unlikely to support struggling institutions like they did in the wake of the 2008 crisis.
Instead, they’ll be forced to turn to the Federal Reserve to print more dollars.
In effect, this increases inflation and pushes down the purchasing power of your money. In the worst cases, it can lead to hyperinflation as we’ve seen in Venezuela.
Bitcoin is the alternative monetary system. It’s the antithesis of fiat money like the dollar.
Unlike fiat, it has a fixed supply so central banks can’t endlessly print more. And its monetary policy is not controlled or manipulated by any one entity.
When the debt bubble finally pops, people will flock to an alternative. ShapeShift CEO Erik Vorhees has predicted that the growing national debt will inevitably lead to a crypto boom.
For now, the national debt continues to build. As Judd Gregg and Edward Rendell of Campaign to Fix the Debt conclude:
“[This] is another sad reminder of the inexcusable tab our nation’s leaders continue to run up and will leave for the next generation.”
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Last modified: March 4, 2021 2:53 PM