Is our national debt finally too much? (update)

(Note: A version of this episode originally ran in 2024 https://www.npr.org/2024/06/07/1197959252/debt-gdp-ratio-growth-united-states.) $40,000,000,000,000. Four commas. Thirteen zeroes. It’s an eye-popping, almost infinite-sounding pile of money. And every time the debt passes a big round number, almost everyone asks the same question: How much debt is too much? It’s maybe the most important question in macroeconomics. It’s also surprisingly hard to answer. When two economists tried to answer it back in 2010, it ignited a research slugfest that lasted a decade. We did a show on this question in 2024, outlining everything we know and don’t know about when the national debt becomes a problem. But a lot has changed. Interest rates have risen and stayed high. Spending has steamrolled ahead. Doves have become hawks. So on today’s show, we update our 2024 episode to revisit the age-old question: Is our debt finally too much? Read Planet Money: Our book: Planet Money: A Guide to the Economic Forces That Shape Your Life https://lnk.to/i3AukBdD Our weekly longform Planet Money newsletter https://n.pr/3zrFvUBOur weekly Indicator round-up newsletter https://www.npr.org/newsletter/indicatorFollow: Instagram https://n.pr/3FqLuwsTikTok https://n.pr/3sGZdrqYouTube https://lnk.to/iCVDaW3CFacebook https://n.pr/3h92GwSSupport public media with NPR+ and enjoy perks for over 25 podcasts like this one. This show’s perks include bonus episodes and sponsor-free listening. Learn more atplus.npr.org http://plus.npr.org/. Our original episode was produced by Willa Rubin and edited by Molly Messick. This update was reported and produced by Vito Emanuel. It was fact checked by Sierra Juarez. It was engineered by Kwesi Lee. And it was edited by Alex Goldmark, Planet Money’s executive producer. See pcm.adswizz.com https://pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences. NPR Privacy Policy https://www.npr.org/about-npr/179878450/privacy-policy

• 0:00Speaker 00

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• 0:17Speaker 01

  This is Planet Money from NPR.

• 0:23Speaker 02

  OK, we are going to start today's show by jumping into the old Planet Money time machine.

• 0:32Speaker 02

  Economic destination, 2009. A time when the government was spending lots and lots of money and the national debt was shooting up.

• 0:42Speaker 03

  Yeah, back then, the US was trying to pull itself out of the recession that followed the financial crisis. And one of the big strategies the government used was just to spend and spend and spend. We bail out some banks, we lowered taxes. There was all this money for infrastructure.

• 0:57Speaker 04

  Early in the recession, I think a lot of people were very supportive of the big steps the government took to increase government spending and reduce taxes.

• 1:08Speaker 02

  That is Karen Dinan. She teaches at Harvard now. Earlier in her career, she worked at the Federal Reserve, did a stint as the chief economist at the Treasury Department.

• 1:17Speaker 03

  And Karen says it didn't take long for some people to question the wisdom of all that spending.

• 1:23Speaker 04

  Attitudes changed. And there were some economists and some policymakers, I think particularly people we would call deficit hawks, who started to get quite concerned.

• 1:36Speaker 02

  Karen, she was firmly in the deficit dove camp back then. To her, it seemed obvious that the economy was not going to get back on its feet without an ongoing infusion of government spending. But she at least understood the thing the hawks were afraid of.

• 1:50Speaker 03

  Sure. In pure dollar terms, at least, the country had never taken on so much debt so fast. In 2008, the gross public national debt was around $6 trillion. Then it was $7 trillion, then $9 trillion. By 2012, it was $11 trillion. These numbers sound almost quaint now.

• 2:10Speaker 02

  And as most econ textbooks will tell you, there can be real dangers in running up a big national debt. One of the classic worries is how much the debt you take on now could cost you in the future.

• 2:22Speaker 04

  So the scary thing about high debt is that you can get a snowballing of debt because of interest costs. And when you're paying a lot of interest and then you're running a larger deficit because you're paying a lot of interest, that adds to the debt. And then you get to the next period and you have more debt. And then you have more interest. And so it just keeps compounding and getting worse and worse and worse.

• 2:47Speaker 02

  After the financial crisis, interest rates were low. But that didn't necessarily mean they would always be low. The markets could look at these higher and higher levels of debt and decide, you know what? Maybe Treasury bonds, the IOUs the US government has to sell to spend more than it takes in. Maybe those bonds aren't such a great investment anymore.

• 3:07Speaker 04

  Debt becomes costly for us when investors, the people that buy our debt, lose their appetite to hold our debt.

• 3:17Speaker 03

  Right, because to keep investors buying that debt anyways, the government would then have to pay higher and higher interest rates on those IOUs, which would make the whole thing snowball even faster.

• 3:26Speaker 02

  Now, neither of those bad, scary outcomes came to pass. In hindsight, it actually seems pretty clear that the people saying the government was right to spend all that money, that they ended up on the right side of history. If anything, a lot of economists, including Karen, actually think that the government should have spent even more than it did, that it could have shortened the Great Recession. But that's hindsight.

• 3:48Speaker 03

  Yeah. Karen says it can be really tricky for policymakers to make these huge decisions in real time without knowing for sure what's going to happen as a result.

• 3:57Speaker 02

  I mean, so the image that comes to mind is that the policymaker, I kind of like, I imagine them sort of inching out on the ice. And then if it cracks, that's when you stop and you hope you don't fall through.

• 4:10Speaker 04

  I think that's right. I mean, I think that's the, I mean, the ice cracking, that's when you're in real trouble.

• 4:16Speaker 03

  But when exactly that ice might crack? When the debt will start to hurt the economy? We can't really say.

• 4:24Speaker 02

  It seems like we don't have a good way of knowing whether we're 5% away from the ice cracking or 50% away from the ice cracking.

• 4:32Speaker 04

  Yeah, that's a problem. That is a, that is a real problem.

• 4:37Speaker 03

  We talked with Karen about this in 2024, in the wake of a sharp spike in the national debt stemming from pandemic spending. Another crisis where the government just pumped an incomprehensible amount of money into the economy and ran up the tab. But since then, the spending continued. The government never closed out on its tab. And now Karen and others are changing their thinking about debt.

• 5:04Speaker 02

  Hello and welcome to Planet Money. I'm Keith Romer.

• 5:06Speaker 03

  And I'm Nick Fountain. Every time the national debt crosses a big scary number, it sparks this debate about whether we finally crossed a red line. Last month, we hit $40 trillion of debt. $40 trillion. It is a ridiculous, almost infinite sounding pile of money. And just on its face, that does sound like too much money for any country to be in debt. But is it?

• 5:35Speaker 02

  Today on the show, a deep dive on what we know and what we don't know about when a lot of debt turns into too much debt. Economists have been thinking about this and fighting about it for a long time now.

• 5:48Speaker 03

  Yeah, we're going to revisit our 2024 debt episode, starting with a brief history of all that thinking and fighting. And then we'll give an update. Because when Keith and I originally did this show, it was just before President Trump's newest round of tax cuts, before the war with Iran, and before all the jitters we've been seeing in the bond market. A lot has changed, including one of our economist dancers.

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• 7:20Speaker 02

  When economists talk about the trouble that a country can get itself in by running up too much debt, there are a few bad scenarios they worry about. One of them is that the country can end up so underwater that it ends up defaulting on its debt, stiffing its creditors, which tends to not go great.

• 7:37Speaker 03

  Sure. Or in order to escape its debt, maybe a country has to let inflation run wild and make its money worthless. Also not great.

• 7:45Speaker 02

  But things can also get bad without getting quite so dramatic. Sometimes having a lot of debt can just drag down the economy, chop growth off at the knees. And this last concern was really what the fight was over in the US in the aftermath of the financial crisis. Was all this money the country was spending ultimately going to end up causing more problems than it solved?

• 8:06Speaker 03

  That relationship between national debt and slow growth also just so happened to be the subject of this famous paper that came out in 2010, right as US debt was really taking off. The paper's authors were these two prominent economists, Carmen Reinhart and Kenneth Rogoff. They dug up all this data about debt for 20 advanced economies across decades. And according to the paper, history had a thing or two to teach us about what levels of debt were OK and which levels maybe weren't OK.

• 8:37Speaker 02

  The paper was short. It was just six pages. It was called "Growth in a Time of Debt." And it kind of took the world by storm. In a lot of ways, it defined the terms of the argument for the next several years. In fact, this little paper had such a big impact that we are going to spend most of the rest of the show talking about it, the ideas it inspired, and also the fights.

• 8:57Speaker 03

  Karen Dinan, the Harvard professor from before, says the paper was such a big deal, in part because it seemed to offer an answer to that giant question on everyone's mind back then. At what point will the debt start to limit economic growth?

• 9:11Speaker 04

  The statistic that caught so much attention was that they had a result that suggested that when a country has debt that is equivalent to 90% of their GDP, that their growth rate would be half of what it would be in times when debt was at a more normal level.

• 9:31Speaker 02

  So just for a little context, in the early 2000s, the debt to GDP ratio in the US was around 35%, meaning the national debt was equivalent to 35% of the value of every good or service the country made for an entire year. By 2010, when the paper came out, the debt to GDP ratio had gone all the way up to 60%. And so you can kind of see why so many politicians and people in the media latched on to that paper.

• 10:01Speaker 03

  Yes, specifically the number 90%. A lot of people read the paper as saying, if your debt goes past 90% of GDP, the wheels are just going to fall off your economy, even though that is not exactly what the paper said. Allow me to Planet Money out on the paper for a second. To be precise, the paper lumped countries into low, medium, high and very high debt groups. This very high debt group contained countries with debt above 90% of GDP, including some countries with way higher debt levels. And so what the paper technically found is that this very high debt group, on average, over a very long time, was associated with lower economic growth.

• 10:46Speaker 03

  But that nuance aside, that 90% number got some real traction. Karen remembers people talking about it as this red line.

• 10:55Speaker 04

  You know, it wasn't your average economist who was running around like things were on fire. It was more that the people who... Didn't like all this fiscal stimulus. We're starting to use it as a reason why the government needed to tighten its belt.

• 11:11Speaker 02

  If you were a debt hawk, you had a good argument for your position.

• 11:14Speaker 04

  Yeah, exactly.

• 11:16Speaker 03

  Now, up to this point, we've been talking about this grand debt experiment as if the US were the only country that was running up this huge bill. But of course, lots of countries were trying to spend their way out of the Great Recession. Debt to GDP ratios were ballooning pretty much everywhere. And so around the world, people were looking at that 90% red line and wondering, um, does that apply to us, too?

• 11:38Speaker 02

  In fact, then, International Monetary Fund economist Andrea Prezbietero was just getting started in macroeconomics.

• 11:44Speaker 06

  At the time, I was an assistant professor at the university in Italy.

• 11:47Speaker 02

  Which university?

• 11:49Speaker 06

  University of Ancona, which is a small place in the east coast of Italy, by the sea.

• 11:54Speaker 03

  As much as the paper itself, Andrea remembers the fights about it, playing out in blogs and newspapers.

• 12:00Speaker 06

  I think when that paper came out, it was a big deal, meaning it was clearly an important paper on a very important topic, very sensitive topic at the time.

• 12:09Speaker 03

  Yeah, these were live arguments. There were impassioned calls for austerity measures and belt tightening, and equally impassioned arguments for the other side, saying, no, don't mess up this recovery. Now is not the time to stop spending.

• 12:22Speaker 02

  The paper even generated a kind of mini scandal at one point. These, shall we say, more debt-friendly economists put out a paper highlighting a pretty big mistake in the Excel spreadsheet that Reinhart and Rogoff had used. The last sentence of that paper reads, "The fact that Reinhart and Rogoff's findings are wrong should therefore lead us to reassess the austerity agenda itself in both Europe and the United States."

• 12:46Speaker 06

  So that was also added sort of to the debate. It was not just a debate, the one where saying, oh, yes, this is a good argument to push for fiscal consolidation, others saying, maybe not. There was also a discussion about, yes, this is basically evidence which is flawed and based on some mistakes. And so that make, I guess, the debate even more sort of strong between people.

• 13:11Speaker 03

  Correcting the spreadsheet mistake did weaken the claim in the paper everyone latched on to, but it didn't disprove it. Their updated paper still showed that high debt was generally correlated with slower growth, just not as steeply as before.

• 13:28Speaker 06

  I think that the true contribution of this paper by Reinhart and Rogoff was to open up a very large body of research that started from their funding and tried to dig deeper and tried to expand our understanding of how debt could affect the economy.

• 13:48Speaker 03

  Yeah, like, here is one very, very important question. Just because there's this correlation between high levels of debt and lower growth, does that necessarily mean that high debt is causing the economy to slow down?

• 14:00Speaker 06

  And I guess that correlation is not causation is sentenced that in Planet Bane has been repeated like zillions of times.

• 14:08Speaker 02

  Basically, it's our motto. Yeah, yeah, we have it in Latin written over the door.

• 14:11Speaker 06

  Exactly. So clearly, also in this case, correlation doesn't mean causation.

• 14:17Speaker 02

  Now, there are good theoretical reasons for why you might think that too much debt could slow down the economy. We've talked about a couple of them already, that snowball effect of all that debt compounding, the way investors can demand higher returns on government bonds. There's also this phenomenon that economists call crowding out, which works like this. To take on debt, the government has to sell Treasury bonds, basically IOUs. And if investors keep buying and buying and buying those Treasury bonds, that means that money isn't going into private investment, you know, building factories or researching the next generation of microchips. And so, growth, the idea goes, is going to suffer.

• 14:56Speaker 03

  But Andrea says that causation here could also run in the opposite direction. Low growth could be causing high debt.

• 15:04Speaker 06

  You can really think a situation in which your economy is underperforming and US policymakers, you want to stimulate the economy, therefore you want to do public consumption, public investment. And one way to do that is borrowing money. If you borrow money, you're going to increase your debt. So what you're going to observe in the data, you have low growth and high debt. And exactly because of this example, clearly, we cannot conclude that higher debt is causing lower growth, if anything's the other way around.

• 15:35Speaker 02

  The causality question is one that Andrea worked on himself. In the end, he and his co-author concluded what pretty much everyone ended up concluding. Based on the empirical evidence at least, you can't definitively answer this one. Andrea thinks that depending on the situation, the causation can run in either direction. Sometimes, high debt causes low growth. Sometimes, low growth causes high debt.

• 15:57Speaker 03

  Andrea and all these different economists around the world also looked into other questions, other ways of looking at the historical data that could help identify when exactly debt might become dangerous.

• 16:08Speaker 06

  This sort of tipping point, if you want, is going to be potentially very different across countries. So it could be 90% for some economies, it could be 45% for other economies, it could be 100% for some other economies.

• 16:23Speaker 03

  Also, it seemed to matter who held the government's debt. Was it banks? Was it investors from inside the country? From outside the country? Was it short-term debt, long-term debt?

• 16:32Speaker 02

  Yeah, how much debt a country can safely take on turns out to depend on all these different factors. This is one where the simple-seeming result, you know, countries that have debt to GDP ratios over 90% see lower economic growth, where that result just got more and more and more complicated the longer people poked at it, which Andrea sees as a good outcome. Economists, they know more now than they did when all of this started.

• 16:58Speaker 06

  Even if you don't get to perfection, even if you do something to the extent that you are aware of limitation of your analysis, I think you still provide a very valuable contribution.

• 17:09Speaker 02

  But here's the thing. After several years of this kind of scholarship, the attention of macroeconomics kind of drifted away from the topic. In part, this is because of how fractured the problem had become, how many tiny pieces that one big, clean-seeming idea had turned out to have been made of. But it was also because the real world itself suddenly seemed to be saying, nah, maybe this isn't such a big, important problem after all. Because the thing that makes high levels of debt destructive to an economy is not really the debt itself. It's the interest a country has to pay on that debt. And in the wake of the financial crisis all around the world, interest rates went down

• 17:51Speaker 02

  to basically zero and just kind of stayed there for years.

• 17:57Speaker 03

  And so for a while, a lot of macroeconomists were like, maybe we don't really need to worry all that much about debt after all. And then the world changed, again, in two ways. First, the pandemic and all the spending that followed pushed debt way higher. And second, and more importantly in this case, interest rates went back up. And so having a lot of debt today is going to cost the US and countries all over the world a lot more than it would have five or six years ago.

• 18:26Speaker 02

  Yeah, that question that economists put down for a bit, how much debt we can get away with, it is starting to look pretty relevant again.

• 18:37Speaker 03

  After the break, just how dangerous is our national debt? We put that question to the OG of debt to GDP ratios.

• 18:48Speaker 02

  It's Kenneth Rogoff. We're talking to Kenneth Rogoff.

• 18:50Speaker 03

  Yes.

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• 20:23Speaker 02

  So I will start you off with the easiest question, which is, can you identify yourself?

• 20:28Speaker 07

  Yeah, my name is Kenneth Rogoff. I'm a professor of economics at Harvard University.

• 20:33Speaker 02

  And I realize you reminded me of one of my other questions, which is Kenneth or Ken?

• 20:38Speaker 07

  Oh, Ken is great.

• 20:39Speaker 02

  OK, so we'll go Ken.

• 20:40Speaker 07

  I mean, but when I'm giving my formal name, Kenneth.

• 20:44Speaker 02

  Formerly Kenneth, informally Ken.

• 20:46Speaker 07

  Yeah.

• 20:47Speaker 02

  If you ask Ken Rogoff about that paper he wrote with Carmen Reinhart, it is clear that he is still kind of annoyed about the way it all blew up. Back then, Reinhart and Rogoff were writing op-eds, warning governments of the risks of debt levels above 90%. But today, he insists he never meant for people to take their groupings of countries into low debt, medium debt, high debt, and very high debt to GDP countries to mean that there was some bright red debt line you couldn't cross.

• 21:16Speaker 07

  One of our buckets was, it was our highest bucket, was 90%. But we didn't say that suddenly you go to the devil when you get to 91%. That's a little bit like saying if you're driving in a car in a 55 mile an hour speed limit and you go to 56, you're going to crash the next minute. And that interpretation, which was polemically used in addition to a lot of polemic misrepresentation, I think, so, it's so crazy. How can they say that? And of course, we didn't.

• 21:49Speaker 03

  And he says, yes, obviously, there are a lot of factors that contribute to when national debt becomes a problem for a country. And of course, different countries are going to be able to tolerate more or less debt.

• 21:59Speaker 07

  But I do want to qualify that a little bit by saying to say, therefore, there's no threshold. Therefore, any level of debt is fine. That's kind of nuts also.

• 22:12Speaker 02

  Yeah, his basic intuition remains unchanged. He says a country is playing with fire. It just loads on more and more and more debt. Eventually, all of that debt is going to slow down the country's ability to grow. And he thinks the US is headed in that direction right now.

• 22:28Speaker 07

  I think if you look at where the United States is today, we're probably on a trajectory that needs to get adjusted. And it's not just our debt. It's our social security, our medical care, everything.

• 22:40Speaker 03

  But Ken says politicians on both sides of the aisle have gotten really resistant to either raising taxes or cutting spending enough to balance the budget.

• 22:50Speaker 07

  The tendencies, when the other party's in power, debt's a terrible problem. And when you're in power, it's not.

• 22:57Speaker 02

  When Ken looks at all this, it's not like he thinks we are headed towards some economic Armageddon.

• 23:03Speaker 07

  You know, barring something really horrible happening, I don't foresee a massive problem.

• 23:11Speaker 02

  But Ken says there are signs of trouble in the economy. We've seen inflation spike, investors demanding higher rates on US Treasuries. To him, those happened partly as a result of all the debt we've taken on. And he thinks spikes in inflation and interest rates might keep happening.

• 23:30Speaker 07

  What I think is likely to happen over the next 10 years is we'll probably have another episode of that. So maybe until we've got punched in the face a couple more times, we may not adjust.

• 23:45Speaker 03

  And adjusting, finding a way to stop running such a high deficit year after year, that would involve some genuinely hard trade-offs, some mixture of cutting into how much we spend on programs that Americans really value, or raising taxes pretty significantly.

• 24:02Speaker 02

  Now, Ken, he has been on the more debt hawkish side of things for a long time now. But even some of those economists who used to feel OK about how high the debt was getting, they are starting to see things differently. Like Karen Dinan, the other Harvard professor we talked to at the start of the show. After the Great Recession, she thought all the spending we were doing was worth the risk. This time around, she's not so sure.

• 24:29Speaker 04

  Policymakers need to be honest about,

• 24:34Speaker 04

  what's on the horizon in terms of national debt and the fact that we are on an unsustainable path.

• 24:42Speaker 02

  My sense is that you did not used to worry about the size of the national debt to the extent that you do today. And I wondered, is it, are you, are you maybe a born-again debt hawk?

• 25:01Speaker 03

  Karen was not willing to go on the record as team hawk, but she did make this stray kind of hawkish comment at a conference.

• 25:08Speaker 02

  She'd been talking about all the stuff we've been talking about in the show, how big the debt is, how higher deficits have been. And she said something to the effect of, you know what? I know there's no magic red line for debt, but maybe we'd all be better off if there was one.

• 25:25Speaker 04

  Having a benchmark like that is useful because it can force action.

• 25:32Speaker 04

  And even though I don't think there is a magic level, I do feel like if there was some level we knew about, it could then kind of be constructive politically and get people to face up to the hard decisions they're going to need to make.

• 25:48Speaker 02

  Like, you kind of wish there was one.

• 25:52Speaker 04

  Yeah, yeah.

• 25:56Speaker 02

  So you don't want me to ask you at what percentage of GDP the national debt will cause a crisis?

• 26:03Speaker 04

  No, I mean, I can't tell you that number.

• 26:06Speaker 02

  Is it 125% of GDP?

• 26:11Speaker 04

  You're still asking me.

• 26:13Speaker 02

  Higher or lower?

• 26:16Speaker 04

  Sorry, I'm not answering that question.

• 26:22Speaker 03

  OK, so that was Karen Dinan and Ken Rogoff in 2024. It has now been two years. And we have added more than $4 trillion more to the debt. Congress passed massive tax cuts in 2025 that ate into revenue. The debt is so high that we are paying over $1 trillion a year just in interest, a record amount by a lot. Given all that, we checked back in with Karen. Is she a hawk now in 2026?

• 26:57Speaker 04

  I am a debt hawk now. Given how things have evolved, we have seen things happen in financial markets, particularly Treasury borrowing rates, that have made me think this is a bigger challenge than I thought it was a couple of years ago.

• 27:14Speaker 03

  Karen says it was really this summer that she started to get worried.

• 27:17Speaker 04

  I think it does feel a little bit like we're walking out on the ice and basically taking reassurance from the fact that it hasn't cracked yet.

• 27:27Speaker 03

  Borrowing rates on US Treasuries, those IOUs we mentioned earlier, went up and have stayed up. And one explanation for this might be that investors think one of the safest investments ever is slightly less safe now. Just last week, the interest rate on the 10-year Treasury hit the highest level recorded since right before the Great Recession.

• 27:48Speaker 04

  And that's a big deal because, first of all, it makes the debt outlook going forward. It makes it worse because it means we're going to be funding our deficits at a higher interest rate.

• 28:01Speaker 03

  Right, the CBO now projects that our debt will cross 120% of GDP in 2036, which would be higher than any point in US history, including World War II. And she does think that these high interest rates are starting to hurt the economy. They drive up mortgage rates for home buyers and make it more costly to pay down credit card debt. Still, she can't give a number of what exactly is the line of too much debt. And now, she says, because of external factors like the immense AI build-out and the Iran war, it is even harder to know where that line is. But yes, even doves are becoming hawks.

• 28:45Speaker 03

  You know who hasn't changed his mind? Ken Rogoff.

• 28:48Speaker 07

  I don't know, you know, people acknowledge fully, as much as I would like, how wrong they were.

• 28:55Speaker 03

  His position is basically, it was bad then, it's worse now. And interest rates are really important for determining how bad you think it is.

• 29:04Speaker 07

  I think the big misconception is that interest rates would be low forever. And if they were high for a while, it was just a bad dream and it was going to go away.

• 29:14Speaker 03

  Yeah, there's some vindication here for him.

• 29:17Speaker 07

  There needs to be some reflection of how wrong everyone got it for so long and the conviction, because that hasn't gone away. Leading opinion makers who thought it before, more or less still think it, they might be right. But the question is, what kind of risk do you want to take? What kind of gambles do you want to make?

• 29:38Speaker 03

  Yeah, and to be clear, the gamble is that a higher debt makes it harder to respond fast enough to a big shock to prevent a crisis, something Ken thinks is pretty likely.

• 29:49Speaker 07

  I do think that the odds that we have a very significant problem are bigger than 50/50. And not the end of the world. And frankly, having a debt crisis is not the end of the world. But I think something very significant's going to happen and we're not, we're not ready for it.

• 30:05Speaker 03

  And the debt to GDP ratio has crossed a somewhat arbitrary but scary line, 100%. We asked him how much that matters. And Ken's answer to that question is basically, look at the interest rates.

• 30:22Speaker 07

  It's not the debt that bothers you, the country. It's how much you have to pay to service it.

• 30:29Speaker 03

  He says, rising debt is like your cholesterol going up. High cholesterol probably won't kill you immediately, but it raises the risk of a heart attack, which leads us back to the question that started this whole saga. Have we now finally racked up too much debt? Neither Ken nor Karen can draw a sharp line of what is too much. But they agree that the solution is cutting spending, raising taxes, or both. And that seems pretty much like a nonstarter. So what is the solution? If a huge bump in growth doesn't bail us out, Karen and Ken both agree: pain.

• 31:10Speaker 07

  I think we need to see much more pain. We're like teenagers that think they're immortal. Other countries don't. I mean, a lot of other countries realize what a crisis this is. But we just don't have it in our DNA at the moment.

• 31:27Speaker 03

  As far as the red line goes, we will probably have to cross it to know where it is.

• 31:36Speaker 03

  If you like stories that help you think through big scary numbers like the national debt, consider hitting follow on your podcast app. It helps the show a lot. It tells our algorithmic overlords that we're a podcast that they should promote to other people. And of course, it means that you'll see every new episode and announcement from us, thanks a trillion or maybe 40 trillion, honestly. The original episode was produced by Willa Rubin, engineered by Sina Lefredo, and edited by Molly Messick. Our update was recorded and produced by Vito Emanuel, fact-checked by Seattle Waters, and edited by our executive producer, Alex Goldmark.

• 32:10Speaker 02

  One final note, The Economist Andrea Presbidero we talked to for today's show. He works at the International Monetary Fund, but the views he expressed are his and not the IMF's, its executive board, or its management.

• 32:23Speaker 03

  I'm Nick Fountain.

• 32:23Speaker 02

  And I'm Keith Romer. This is NPR. Thanks for listening.

• 32:30Speaker 00

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