Factor in the liabilities of state governments, public institutions, and household debts, and the figure for US debt swells to a staggering $100 trillion—an amount nearly equal to the total annual output of the entire planet.
The gravest threat to global stability today is not the bombast of religious fundamentalists in the Middle East, but the relentless expansion of American debt. A civilization can survive fanaticism; it cannot survive the implosion of its currency. How far can this edifice of paper promises stretch—$150 trillion, $200 trillion—before the dollar’s architecture of confidence crumbles?
It is an illusion to think that such a house of cards will stand forever. When it falls, the collapse will not merely be an American tragedy; it will be an economic extinction event. Western Europe will reel, Asia will stagger, and any nation tethered to the dollar’s mast will be dragged into the depths.
For India, the lesson is plain: diversify trade, dilute dollar dependency, and build buffers. Ironically, the tariffs Washington has so generously imposed may become the very medicine that reduces our exposure. In global finance, as in life, sometimes the insult is the cure.
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