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Goldman Sachs economists dispute President Trump's claim that the GOP spending bill will solve the U.S.'s unsustainable debt. While the bill might slightly lower the deficit excluding interest, rising borrowing costs leave the total deficit largely unchanged. The $36 trillion national debt, exceeding 120% of GDP, necessitates either tax increases, spending cuts, or a combination. Higher interest rates exacerbate the problem, potentially forcing drastic austerity measures or hyperinflation if left unaddressed. The situation is complicated by uncertain future interest rate movements and potential shifts in foreign demand for U.S. debt.

Prepared by Christopher Adams and reviewed by editorial team.