When it comes to a U.S. debt default, never say never
https://www.reuters.com/markets/when-it-comes-us-debt-default-never-say-never-fridson-2025-06-11/
Here are a few instances over the past two and a half centuries when the U.S. government did not quite deliver what it promised.
In 1814, the financial burden of the war with Great Britain prevented the Treasury from scrounging up enough cash to service its debts. “The dividend on the funded debt has not been punctually paid,” Alexander J. Dallas, the sixth U.S. Treasury Secretary, acknowledged. “A large amount of Treasury notes has already been dishonored.”
In 1862, the costs of fighting a war once again strained the U.S. Treasury. In response, the government paid its bills by printing pure paper money, so-called “greenbacks,” at a time when the dollar was still legally pegged to gold. During the Civil War, the greenback depreciated sharply versus gold whenever the Union army suffered a setback.
And then there was the abrogation of the gold clause. Up until Franklin D. Roosevelt’s presidency, Treasury bonds were sold with a contractual clause stating that holders could demand payment in gold. However, a joint resolution of Congress revoked that clause on June 5, 1933, and the Supreme Court upheld the Congressional action on dubious legal grounds.
https://www.reuters.com/markets/when-it-comes-us-debt-default-never-say-never-fridson-2025-06-11/
Here are a few instances over the past two and a half centuries when the U.S. government did not quite deliver what it promised.
In 1814, the financial burden of the war with Great Britain prevented the Treasury from scrounging up enough cash to service its debts. “The dividend on the funded debt has not been punctually paid,” Alexander J. Dallas, the sixth U.S. Treasury Secretary, acknowledged. “A large amount of Treasury notes has already been dishonored.”
In 1862, the costs of fighting a war once again strained the U.S. Treasury. In response, the government paid its bills by printing pure paper money, so-called “greenbacks,” at a time when the dollar was still legally pegged to gold. During the Civil War, the greenback depreciated sharply versus gold whenever the Union army suffered a setback.
And then there was the abrogation of the gold clause. Up until Franklin D. Roosevelt’s presidency, Treasury bonds were sold with a contractual clause stating that holders could demand payment in gold. However, a joint resolution of Congress revoked that clause on June 5, 1933, and the Supreme Court upheld the Congressional action on dubious legal grounds.
Related:
How the Federal Reserve Fuels Fiscal Profligacy
https://www.wsj.com/opinion/how-the-federal-reserve-fuels-fiscal-profligacy-national-debt-spending-4960b906
The central bank is the largest holder of U.S. debt, giving it undue influence on the federal budget.
https://www.wsj.com/opinion/how-the-federal-reserve-fuels-fiscal-profligacy-national-debt-spending-4960b906
The central bank is the largest holder of U.S. debt, giving it undue influence on the federal budget.