Jan Hatzius (L), chief economist at Goldman Sachs, Karen Karniol-Tambour (C), co-chief investment officer at Bridgewater Associates, and Natasha Sarin, a professor of law at Yale University, speak at a panel on the global economy at the Council on Foreign Relations in New York, the United States, Jan. 7, 2026. U.S. debt levels are likely to keep rising as political divisions and growing entitlement costs make it difficult to slow deficits, experts said on Wednesday. Speaking at a panel on the global economy at the Council on Foreign Relations, panelists said that the United States faces long-term fiscal pressure despite solid near-term economic performance. (Xinhua/Zhang Fengguo)
NEW YORK, Jan. 7 (Xinhua) -- U.S. debt levels are likely to keep rising as political divisions and growing entitlement costs make it difficult to slow deficits, experts said on Wednesday.
Speaking at a panel on the global economy at the Council on Foreign Relations, panelists said that the United States faces long-term fiscal pressure despite solid near-term economic performance.
Karen Karniol-Tambour, co-chief investment officer at Bridgewater Associates, said there is no single debt threshold that triggers market stress, but warned that debt becomes harder to manage when growth and productivity weaken.
"There isn't a magic number where the market basically goes on strike," she said, adding that slow growth can cause debt burdens to rise even without new spending. She said higher spending needs linked to defense, infrastructure and artificial intelligence are adding pressure to public finances.
Natasha Sarin, a professor of law at Yale University, said that U.S. debt-to-GDP ratios could approach 140 percent under more realistic assumptions as entitlement spending increases and projected revenues remain uncertain.
"We are moving toward an entitlement crisis," Sarin said, noting that trust funds supporting major social programs could be depleted in the early 2030s. She said political support for deficit reduction remains limited, in contrast to the 1990s when budget surpluses were achieved.
Jan Hatzius, chief economist at Goldman Sachs, said that the United States still has more fiscal capacity than many advanced economies but warned that demographic trends and rising borrowing needs make long-term adjustments difficult. ■