Depending on who one is speaking with, the national debt either is — or is not — an important issue in American fiscal policy that is given the degree of attention it deserves.
Scott Galloway, New York University professor and popular podcaster, minces no words on how he feels about the “Big Beautiful Bill” that was passed on May 22 by the House of Representatives and its effect on the debt and other important slices of the U.S. economy pie chart.
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For one, there is little disagreement that the rising national debt affects government spending, economic stability, and long-term financial planning. As the federal government borrows to cover expenditures exceeding revenue, interest payments on the debt consume a growing portion of the budget.
The passage of the bill in the House introduces new fiscal measures that may impact the trajectory of the national debt and government spending.
Supporters argue that the bill provides tax relief for working families. They highlight that the bill reduces the tax burden on middle-class Americans, including an expanded child tax credit and eliminating taxes on tips and overtime pay.
Critics argue the bill adds trillions to the deficit, cuts Medicaid and Supplemental Nutrition Assistance Program (SNAP) benefits, weakens federal oversight, and focuses on tax cuts for wealthy Americans.
Related: Shark Tank’s Kevin O’Leary sends strong message on Social Security
One of the key concerns surrounding the increasing debt is the cost of servicing it. As interest rates fluctuate, higher payments on the debt reduce funds available for other priorities, including Social Security and other retirement programs.
This dynamic raises questions about the sustainability of retirement plans for millions of Americans. If debt servicing costs continue to grow, policymakers may face difficult decisions about entitlement reforms, tax changes, or adjustments to retirement benefits.
Galloway explains in no uncertain terms his view of the national debt, the recently passed bill and risks facing the U.S. economy.
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Scott Galloway warns Americans on national debt, transfer of wealth
In his No Mercy / No Malice newsletter, Galloway wastes no time offering his assessment of the bill and its effect on the national debt.
“Last week, the fiscal lunatics proved they are still running the asylum,” he wrote. “House Republicans sent the Senate a budget that adds $3.8 trillion to the deficit. Trump’s ‘Big Beautiful Bill’ pairs unfunded tax cuts for the wealthy with a combined $1.1 trillion reduction in spending on programs including Medicaid and SNAP.”
But Galloway’s criticism is not necessarily aimed at one political party more than the other.
“Raise taxes or cut spending?” he asked. “The answer is yes. Note: Both parties engage in this consensual hallucination — taxes went down during the Biden administration and spending (YTD) has gone up under Trump.”
More on the U.S. economy:
- Dave Ramsey sounds alarm for Americans on Social Security
- Scott Galloway warns Americans on 401(k), US economy threat
- Shark Tank’s Kevin O’Leary has message on Social Security, 401(k)s
The most rapidly expanding expense in the federal budget isn’t defense or health care, Galloway asserts. It’s the cost of servicing the national debt. Even if this $3.7 trillion proposal fails to become law, interest payments alone are projected to reach $13.8 trillion over the next ten years, creating long-term financial challenges for future generations.
“We’re basically cosigning a subprime mortgage for our grandchildren while giving the wealthy a trust fund top-off,” Galloway wrote.
The first baby boomers reach 79 this year. Despite advancements in health, aging remains inevitable, he explains. A $124 trillion wealth transfer is underway, but most Americans won’t benefit — only 2% control half of it.
Related: Dave Ramsey sounds alarm for Americans on Social Security
Galloway shares his proposal on estate taxes, national debt reduction
Galloway argues that smart taxation raises revenue with minimal harm. While Americans instinctively reject the estate tax as a “death tax,” it primarily affects dynastic wealth, not ordinary estates.
Unrealized capital gains comprise most high-net-worth inheritances, avoiding taxation almost entirely, Galloway claims. The budget bill worsens this, cutting estate tax revenue while reducing funding for federal programs aimed at helping the less well-off.
Galloway explains his proposal as follows:
The U.S. should drop its exemption to $1 million and tax inheritances above that threshold at 40%, without loopholes. According to Brookings, that would raise an estimated $118 billion in annual revenue, or more than $1 trillion over a decade — enough to cover proposed cuts to Medicaid and SNAP.
Related: Jean Chatzky warns Americans on Social Security, 401(k)s
