Former UN Ambassador Nikki Haley warned that Social Security faces a looming funding crisis as the U.S. national debt surpassed $40 trillion, intensifying concerns over the government’s fiscal outlook.
Haley Warns of Social Security Crisis
On Wednesday, Haley shared a CNBC report on X highlighting the latest U.S. debt milestone and wrote, “Social Security will go bankrupt in 5 years [affecting] 75 million Americans.”
“You can’t blink away this growth in our debt,” she added.
She further said, “This is past a crisis situation and needs to be a top priority for every elected official.”
Haley’s comments came after the U.S. national debt surpassed $40 trillion, reaching about $40.05 trillion, according to the Treasury Department.
US Debt Tops $40 Trillion
U.S. government debt has reached $40.05 trillion, up from $19.4 trillion a decade ago, driven by years of large budget deficits and pandemic-era spending.
The government posted a $432.3 billion deficit in July, while the year-to-date shortfall is approaching $1.8 trillion.
Rising debt and deficits have contributed to higher Treasury yields and borrowing costs.
Interest payments on the national debt have reached nearly $1.2 trillion this year, making them the largest federal budget expense after Social Security and Medicare.
Debt Concerns Raise Inflation and Spending Alarms
The 30-year Treasury yield reached 5.323%, a 19-year high, as investors weighed inflation, federal deficits and rising government borrowing.
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Consumer prices rose 3.4% year over year in July.
Last week, Sen. Rand Paul (R-Ky.) criticized the record $432 billion July budget deficit, saying the government was spending money “that we don’t have.”
He also warned against additional spending as the national debt neared $40 trillion.
Economist Peter Schiff warned that rising debt could fuel higher consumer prices, predicting the Federal Reserve could create more money to purchase Treasuries.
His warning came after U.S. debt surpassed 100% of GDP, raising concerns over the potential inflationary impact of the growing fiscal burden.
Trump Defended Rising US Debt
Earlier, President Donald Trump defended the rising national debt, arguing that America’s total assets were worth hundreds of trillions of dollars.
He also supported government equity stakes in companies and had previously pointed to tariff revenue and foreign investment as ways to address the debt, which had surpassed 100% of GDP.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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