Economists surveyed by Goldman Sachs voice concerns over US fiscal policy

Last week, investors' concerns about the growing US national debt eased, but some experts warn that the problems are far from over. Goldman Sachs spoke with three top economists about America’s debt situation, and all of them expressed worries over a potential crisis, particularly in light of Donald Trump’s fiscal policies.

Ray Dalio, founder of Bridgewater Associates, warns that the US financial system could face serious instability if the government loses its ability to service the national debt. To avoid this crisis, he suggests the US must slash its budget deficit to 3% of GDP.

According to Kenneth Rogoff, a prominent American economist, if the US maintains its current fiscal policies, a debt crisis could hit within the next four to five years. He identifies two major risks: an inflationary shock or prolonged high interest rates. Either scenario could have severe consequences for the US economy.

Researcher Neil Ferguson warns that the US could lose its status as a global superpower. He argues that when a country spends more on debt servicing than on defense, it undermines its worldwide influence. In 2024, America crossed that threshold for the first time.