Elon Musk and Financial Titans Sound Alarm on U.S. National Debt Amid Controversial Spending Bill

Elon Musk has publicly distanced himself from former President Donald Trump following a contentious Congressional spending bill, labeling it as fiscally irresponsible and warning that it could exacerbate the U.S. national debt to alarming levels. Prominent financial leaders, including Jamie Dimon, Jerome Powell, Ray Dalio, and Warren Buffett, have echoed Musk’s sentiments, raising alarms about the potential economic fallout from unchecked government borrowing.

The rift between Musk and Trump marks a significant shift, as the Tesla CEO departed Washington D.C. amid a vociferous critique of the White House’s primary spending initiative. Musk described Trump’s “big, beautiful bill” as a “massive, outrageous, pork-filled Congressional spending bill,” expressing grave concerns that it would contribute to the national debt rather than alleviate it.

Musk’s apprehensions are rooted in the belief that the legislation, which features the “largest tax cuts in history,” will inflate the national debt, which he has been actively attempting to mitigate through his initiative, the Department of Government Efficiency (DOGE). The national debt currently stands at $32.6 trillion.

While the White House claims that its policies will boost the economy by 2.6% to 3.2% in the long run and increase median household incomes by $5,000 annually, independent analysts project that the law would add approximately $3.8 trillion to the deficit. In contrast, proposed cuts to Medicaid would only yield about $1 trillion in savings.

Musk further condemned the spending bill, branding it a “disgusting abomination” on social media platform X, asserting that it would drastically increase the budget deficit to $2.5 trillion and impose unbearable debt on American citizens. He warned, “Congress is making America bankrupt.”

The concern regarding the U.S. national debt extends beyond its mere existence; it also encompasses the critical debt-to-GDP ratio. The key question remains whether the U.S. economy can grow sufficiently to manage existing debt obligations while accommodating new borrowing for future interest payments.

In a striking move, Musk amplified his critique by sharing a video of Federal Reserve Chairman Jerome Powell discussing the implications of national debt. He commented, “This immense level of overspending will drive America into debt slavery!” Musk elaborated that interest payments already account for 25% of government revenue, warning that continued deficit spending would leave no funds for essential services like Social Security, healthcare, or defense.

Musk’s concerns are shared by several influential figures in the financial sector. Jamie Dimon, CEO of JPMorgan Chase, recently expressed his apprehension about the looming debt crisis. Speaking at the Reagan National Economic Forum, he predicted that the bond market would inevitably “crack” due to excessive spending and quantitative easing. Dimon stated, “I just don’t know if it’s going to be a crisis in six months or six years, but we need to change both the trajectory of the debt and the ability of market makers to function.”

Jerome Powell has also voiced his worries about the sustainability of the national debt, emphasizing that it is imperative for elected officials to engage in a serious discourse about fiscal responsibility. He remarked, “It’s probably time, or past time, to get back to an adult conversation among elected officials about getting the federal government back on a sustainable fiscal path.”

Ray Dalio, founder of Bridgewater Associates, highlighted the potential for a severe market disruption if the U.S. continues to issue debt that the global market is unwilling to absorb. He warned of “shocking developments” on the horizon regarding how the nation will manage its debt.

Warren Buffett, the CEO of Berkshire Hathaway, has also weighed in, acknowledging the significant fiscal challenges the U.S. faces. At a recent shareholder meeting, he reflected on the long-term unsustainability of the current fiscal deficit and the complexities involved in addressing it. Buffett stated, “If something can’t go on forever, it will end,” emphasizing the urgent need for effective management of government finances.

Economists share similar concerns about the viability of U.S. debt. Joao Gomes, a finance professor at Wharton, cautioned that the ability to attract buyers for U.S. debt is diminishing. He noted, “If those who have historically been willing to purchase government debt decide it is no longer a good investment, we could face a real crisis.”