Treasury Dept declares USA “insolvent”. But why now? Hasn't this been true for years?

Photo above - "Morning Joe" debates Senator Chuck Schumer about the Iran war. Not discussed: the Treasury department's declaration the same week that the US is "insolvent", or what Schumer will do about it when he becomes Majority Leader.

Is this one of those “a tree fell in the forest, and nobody heard it” situations. Last week the US Treasury declared America “insolvent” - $6 trillion in assets, $47 trillion in debts. Hence the constantly echoed $39 trillion national debt figure. I know – the numbers don’t reconcile, and the article (Fortune link below) doesn’t explain why.

Fortune Magazine feigns surprise that “the media didn’t notice”. But the media has been willfully ignoring the national debt for years – decades. When did you ever hear the media zeroing in on national debt during a presidential debate? The only coverage America’s budget deficit gets is when there’s a fake “government shutdown” for a week or so. Followed by a sigh of relief when both parties agree to temporary measures to keep spending waaaaay more than is paid in taxes. The important thing is that everyone can keep getting paid. So that we can keep 800+ military bases open for business. So that the national parks and museums can reopen. So that furloughed workers can return from home and collect full back pay for their time off. THAT’s the sort of coverage which the media finds compelling. TSA agents who didn't get a paycheck - it's super easy to find people who want to be interviewed about that.

The link also dips its toe into the related story that Social Security and Medicare have additional off-the-record debts totaling $88 Trillion. This means the US actually owes 3 times the scary $39 trillion number. Entitlement programs have a legal obligation to pay out $88 trillion more than they have, and the gap is widening. But congress says not to worry, they have a fix for this problem: raise payroll taxes, add more working years until retirement eligibility, and reduce monthly checks. Probably all 3 at once.

The Treasury Department's declaration of insolvency wasn’t made in an official press release. It was included on page 100-somethng of their recap of the fiscal year which just ended. If the Treasury department HAD wanted more attention, they COULD have issued a press release. Like they did on other topics the same week: Artificial Intelligence (they support “Clarity” style legislation); Hizbollah (new terrorism sanctions); Student Loans (a partnership with other agencies to discuss future solutions). In fact, the Treasury department issues at least one press release a day, rain or shine.

The 2025 fiscal year declaration of “insolvency” isn’t intended to hide anything. In fact Secretary Bessent himself occasional warns that government deficits are bad. My theory is that the declaration of insolvency is a signal that the Federal Reserve will resume raising interest rates on April 29th. The timing makes perfect sense. Everyone involved can point to the “insolvency” page of the annual report. And income tax season will be over by the. The media and citizens will be amazed to learn that taxes paid fell short of expectations. Voila . . . rates should rise.

Then the press will go into a frenzy, and speculate how this could affect the mid-term elections, which is always the real story. Will any incumbent senators and congresspersons lose their jobs? And what happens when Chuck Schumer (democrat, NY) becomes the new Senate majority leader? Impeachment charges against the president?

Spoiler alert – whatever happens won’t involve less government spending.

I’m just sayin’ . . .



The Treasury just declared the US insolvent. The media missed it

https://www.msn.com/en-us/money/markets/the-treasury-just-declared-the-us-insolvent-the-media-missed-it/ar-AA1Zebhg?cvid=69c25d480a944b5f8bfff524e87127b1&ei=11