Musk Warns of US Bankruptcy Risk Unless Immediate Action on Federal Spending is Taken

In a recent post on X, Musk reiterated his concerns, calling for “major and immediate” action to prevent the nation from reaching a financial collapse.

The CEO of SpaceX and owner of X is set to co-lead the Department of Government Efficiency [DOGE], a new agency created to tackle unnecessary federal expenditures once President-elect Donald Trump takes office.

Musk pointed to the significant increase in national debt since the last major government review in 1984, when the national debt stood at $1.6 trillion, with a debt-to-GDP ratio of about 38%.

Today, that ratio has surpassed 121%, with the national debt exceeding $36 trillion. The debt ceiling is expected to be hit shortly after Trump's inauguration.

Musk, who has previously called for reducing government waste, pledged during Trump’s reelection campaign to cut the federal budget by $2 trillion.

However, he tempered his expectations, acknowledging that a reduction of $1-2 trillion would be a more realistic target, helping to balance the economy and curb inflation.