If DOGE fails to cut US deficit then what is potential timeline for a U.S. economic collapse similar to the Soviet Union’s (USSR), given a current national debt of $37 trillion increasing by $1 trillion every 100 days.
US debt was $34 trillion in January 2024.
Would this lead to hyperinflation, an upward spiral in interest rates and inflation? The U.S. might lose its status as the world’s reserve currency to alternatives like Bitcoin, the Euro, or the Yuan.
Let’s break this down step-by-step.
Understanding the Current Debt Trajectory
The U.S. national debt is currently $37 trillion, and it’s growing at a rate of $1 trillion every 100 days. This translates to an annual increase of approximately $3.65 trillion (since there are about 365 days in a year, and $1 trillion every 100 days equals 3.65 increments per year). If this pace continues unchecked, the debt could reach insane levels:
In 5 years: $37 trillion + (5 × $3.65 trillion) = $55.25 trillion
In 10 years: $37 trillion + (10 × $3.65 trillion) = $73.5 trillion
In 20 years: $37 trillion + (20 × $3.65 trillion) = $110 trillion
Adding $330 billion per year on an scaled up Ukraine war for say 3 years would add another trillion to the debt. This would make the 5 year debt $56.35 trillion. If interests rates were the same as 2024 then the annual interest would be $1.06 trillion per year in 2030 and $2 trillion per year in 2045.
As is often said, going bankrupt happens slowly and then suddenly.
The USSR’s collapse in 1991 was driven by economic mismanagement, political instability, and external pressures, which differ from the U.S.’s current context. The U.S. benefits from its ability to print its own currency and the dollar’s status as the world’s reserve currency, giving it more flexibility than the USSR had.
When Could a Collapse Happen?
A “collapse” like the USSR’s implies a complete breakdown of the economic and political system. While the U.S. debt is a serious concern, a sudden collapse is unlikely in the near term due to mechanisms like domestic debt ownership (much of the debt is held by U.S. entities) and the Federal Reserve’s ability to manage monetary policy. However, if the debt continues to grow at $1 trillion every 100 days without fiscal adjustments or significant economic growth, it would become unsustainable.
The U.S. debt-to-GDP ratio is currently over 120%, a level that historically signals risk for some nations. If this ratio keeps rising—say, to 150% or 200%—the burden of debt servicing could overwhelm the economy. At the current rate, and assuming GDP growth doesn’t keep pace, this could happen within 10 to 20 years (roughly 2034–2044).
Some analysts think a crisis could hit as early as 5 years (around 2029) if trends worsen, but this is not a consensus view. A more gradual decline or crisis is more likely than a sudden USSR-style collapse.
Hyperinflation and an Upward Interest Rate/Inflation Spiral
Hyperinflation occurs when confidence in a currency collapses, often due to excessive money printing to pay off debts, leading to rapidly rising prices. The U.S. has increased its money supply in recent years (e.g., during the COVID-19 pandemic), but hyperinflation hasn’t occurred … yet, thanks to the Federal Reserve’s inflation controls.
However, if debt growth forces more money printing, confidence could erode.
An upward spiral in interest rates and inflation could start if the Federal Reserve raises rates to combat inflation, increasing the cost of paying the interest on the debt. The US paid $680 billion in interest last year. This is projected to hit $1.2 trillion by 2032 per the Congressional Budget Office). Higher debt costs could then require more borrowing or printing, fueling further inflation. This cycle could emerge if debt becomes unmanageable—potentially within 10 years (by 2034) if current trends persist and no corrective action is taken. Hyperinflation might follow shortly after if confidence in the dollar plummets, though this could only be delayed by policy interventions.
Loss of Reserve Currency Status
The U.S. dollar’s role as the world’s reserve currency depends on global trust in the U.S. economy. If the debt crisis erodes this trust, alternatives like Bitcoin, the Euro, or the Yuan could gain ground. Here’s how they stack up:
Bitcoin: Seen as a decentralized alternative with a fixed supply, Bitcoin could grow as a hedge against inflation. However, its volatility and limited use in everyday transactions make it unlikely to replace the dollar soon. It might gain prominence over 20–30 years if fiat currencies weaken significantly.
Euro: The Euro is a major currency, but the Eurozone’s internal economic disparities and political challenges limit its ability to overtake the dollar. It’s not an immediate threat.
Yuan: China’s Yuan is rising, especially with efforts like the BRICS coalition exploring new reserve options. Yet, its government control and China’s own economic issues reduce its global appeal. It could challenge the dollar in 20–30 years if China’s influence grows.
The U.S. could start losing reserve status within 20–30 years (2044–2054) if debt sustainability falters and alternatives mature. Some warn of a faster shift—by 2030—but this assumes a rapid decline in dollar confidence.
High Risk by the mid-2030s and pretty certain doom by 2045
USSR-style Collapse: Not imminent, but a debt crisis could emerge in 10–20 years (2034–2044) if the debt grows unchecked at $1 trillion every 100 days, reaching $73.5–$110 trillion. A sudden collapse is less likely than a prolonged struggle.
Hyperinflation and Interest Rate/Inflation Spiral: Could begin within 10 years (by 2034) if debt servicing costs spiral and confidence in the dollar weakens, with hyperinflation possible soon after.
Loss of Reserve Currency Status: A gradual shift to Bitcoin, the Euro, or the Yuan might occur over 20–30 years (2044–2054), though a faster transition by 2030 is possible if a crisis accelerates.
These timelines are estimates, not certainties. The U.S. has tools to delay or avoid these outcomes such as actually cutting the spending by $1 trillion using DOGE.
Brian Wang is a Futurist Thought Leader and a popular Science blogger with 1 million readers per month. His blog Nextbigfuture.com is ranked #1 Science News Blog. It covers many disruptive technology and trends including Space, Robotics, Artificial Intelligence, Medicine, Anti-aging Biotechnology, and Nanotechnology.
Known for identifying cutting edge technologies, he is currently a Co-Founder of a startup and fundraiser for high potential early-stage companies. He is the Head of Research for Allocations for deep technology investments and an Angel Investor at Space Angels.
A frequent speaker at corporations, he has been a TEDx speaker, a Singularity University speaker and guest at numerous interviews for radio and podcasts. He is open to public speaking and advising engagements.
