Elon Musk criticizes the US government regarding its use of money after the US debt hit a record high of more than $31 trillion.
The US National debt has exceeded $30 trillion for the first time in history, amounting to nearly 130% of the country’s yearly economic output. This high and rising federal debt is largely due to the government’s response to the COVID-19 pandemic, involving cash infusions into the economy.
As of January 31, $6.5 trillion of the national debt is classified as “intragovernmental holdings” and held by federal agencies like the Social Security Administration, while $23.5 trillion is classified as debt held by the public, including individual investors, investment funds, foreign governments, and the Federal Reserve.
The cost of servicing the national debt has become a major part of the federal budget, with the government making $562 billion in interest payments in 2021. The US’s debt-to-GDP ratio places it as the 12th most indebted country globally and fourth among developed economies.
Elon Musk Takes Aim at the US Government
Billionaire entrepreneur and tech innovator, Elon Musk, took to Twitter recently to share his thoughts on the topic of personal finance. In a tweet, Musk listed “4 Signs You Are Bad With Money,” including the inability to balance a budget, borrowing from others to pay bills, lending money before paying bills, and having a debt over $30 trillion.
This tweet sparked a heated debate among Twitter users, as the US national debt recently exceeded $30 trillion for the first time in its history. While Elon Musk does not mention the US in his tweet, many have interpreted his words as a hint at the current financial state of the country.
Of course, the tweet was followed by continuous arguments by people questioning US political parties, both the democrats (currently in charge) and republicans.
Given the recent US monetary policies, political instability, and economic crisis at a macro level, the debate is still ongoing and may likely be an area of focus. This has implications in many financial markets, including the crypto market.
Some, presumably “defending” the current government, reacted negatively to Elon’s tweet. For instance, one user suggested that Elon Musk is bad with money too because of his recent Twitter acquisition.
For more context, Elon Musk became the first person to lose more than $180 billion in one year. Therefore, many said that Musk is not competent to speak on behalf of the country’s finances when he cannot manage his own.
Still, Musk’s comical criticism of the US debt is reasonable. He and everyone in the US have reasons to be alarmed about the national debt, given the current debt-to-GDP ratio.