B1 · Intermediate
12 min
economicsgeopoliticsus politics
Forty Trillion. Nobody Blinked.
Cuarenta billones y nadie pestañea
The US national debt has crossed forty trillion dollars for the first time in history. Fletcher and Octavio dig into how we got here, what it means for the dollar's role in the global economy, and why this number should worry everyone, not just Americans.
La deuda nacional de Estados Unidos acaba de superar los cuarenta billones de dólares por primera vez en la historia. Fletcher y Octavio analizan cómo llegamos aquí, qué significa para el dólar como moneda global y por qué este número debería preocuparnos a todos.
6 essential B1-level terms from this episode, with translations and example sentences in Spanish.
| Spanish | English | Example |
|---|---|---|
| deuda | debt | La deuda nacional de Estados Unidos superó los cuarenta billones de dólares. |
| billón | trillion (in Spanish; not the same as English 'billion') | Un billón en español equivale a un millón de millones, no a mil millones. |
| intereses | interest (financial) | El gobierno pagó muchos intereses por su deuda este año. |
| reservas | reserves (financial) | Muchos bancos centrales tienen dólares en sus reservas. |
| bonos del Tesoro | Treasury bonds | China compró muchos bonos del Tesoro americano durante años. |
| falso amigo | false friend (a word that looks similar in two languages but means something different) | 'Billón' es un falso amigo para los estudiantes de español que hablan inglés. |
Forty trillion dollars.
I've been staring at that number all morning and it still refuses to feel real.
Sí, ayer el Departamento del Tesoro de Estados Unidos confirmó que la deuda nacional superó los cuarenta billones de dólares por primera vez en la historia.
Yes, yesterday the US Treasury Department confirmed that the national debt surpassed forty trillion dollars for the first time in history.
And just to be precise about the geography of this number, we're talking forty trillion with a T.
Forty thousand billions.
A figure so large that every metaphor I've tried this morning has collapsed under its own weight.
La deuda era de veinte billones en 2017.
The debt was twenty trillion in 2017.
En menos de diez años, se duplicó.
In less than ten years, it doubled.
Eso es muy importante porque significa que el problema no empezó hace poco.
That's very significant because it means the problem didn't start recently.
Right, and Reuters specifically noted that it doubled across the Trump and Biden administrations, which is a useful reminder that this isn't a partisan story.
Both parties contributed substantially.
Exacto.
Exactly.
Los dos partidos gastaron mucho dinero.
Both parties spent a lot of money.
Los republicanos con los recortes de impuestos y los demócratas con los programas sociales.
The Republicans with tax cuts and the Democrats with social programs.
Los dos contribuyeron al problema.
Both contributed to the problem.
I want to put this in some historical context, because I think it matters enormously.
The US crossed one trillion dollars in debt in 1981.
It took about two hundred years to get there.
And now we're adding a trillion roughly every hundred days.
Cien días.
A hundred days.
Es increíble.
That's incredible.
Y hay que recordar que mucha de esta deuda viene de momentos de crisis: la crisis financiera de 2008, la pandemia de 2020.
And we have to remember that a lot of this debt came from moments of crisis: the 2008 financial crisis, the 2020 pandemic.
En esos momentos, el gobierno necesitaba gastar mucho dinero rápidamente.
In those moments, the government needed to spend a lot of money quickly.
That's fair.
Emergency spending is a different category from structural spending.
The pandemic alone added something like five trillion dollars to the debt.
But here's what bothers me: the emergency ended.
The debt didn't.
Sí, ese es el problema real.
Yes, that's the real problem.
Cuando la emergencia termina, el gasto no vuelve a los niveles anteriores.
When the emergency ends, the spending doesn't return to previous levels.
Los programas nuevos continúan, los intereses de la deuda continúan, y todo cuesta más cada año.
New programs continue, debt interest payments continue, and everything costs more every year.
The interest payments alone, last I checked, are running close to a trillion dollars a year.
To put that in terms that actually sting: the US now spends more servicing its debt than it spends on defense.
Eso es enorme.
That's enormous.
Y en España, cuando hablamos de la deuda pública española, que también es grande, siempre pensamos: pero la deuda americana es diferente porque el dólar es la moneda del mundo.
And in Spain, when we talk about Spanish public debt, which is also large, we always think: but American debt is different because the dollar is the world's currency.
The exorbitant privilege, they call it.
The phrase was coined by Valéry Giscard d'Estaing back in the sixties, when he was France's finance minister.
The idea that America can borrow in its own currency, and the world has no choice but to keep accepting dollars.
Exactamente.
Exactly.
Cuando China o Arabia Saudí venden petróleo o productos, muchas veces reciben dólares.
When China or Saudi Arabia sell oil or products, they often receive dollars.
Y con esos dólares compran deuda americana.
And with those dollars they buy American debt.
Es un sistema que funciona porque todo el mundo confía en el dólar.
It's a system that works because everyone trusts the dollar.
And the question that I keep turning over is: how long does that trust hold?
Because trust isn't infinite.
It's not guaranteed by geography or history.
It has to be earned, or at least not actively destroyed.
Hay economistas que dicen que cuarenta billones es solo un número, que lo importante es la deuda como porcentaje del PIB.
There are economists who say that forty trillion is just a number, that what matters is the debt as a percentage of GDP.
Y ese número también es alto, casi el ciento veinte por ciento del PIB americano.
And that number is also high, almost one hundred and twenty percent of American GDP.
Japan is at two hundred and sixty percent of GDP and still functioning.
So the raw ratio isn't automatically catastrophic.
But Japan is a very different case, it owes most of its debt to its own citizens, in its own currency, with a population that saves at a remarkable rate.
Sí, la situación de Japón es especial.
Yes, Japan's situation is special.
La deuda americana es más internacional.
American debt is more international.
Muchos países y fondos de inversión de todo el mundo tienen bonos del Tesoro americano.
Many countries and investment funds from around the world hold US Treasury bonds.
Which is actually one of America's great structural advantages, and also one of its vulnerabilities.
If a major holder, China, for instance, decided to liquidate a significant portion of those Treasury bonds, the ripple effects would be felt everywhere.
China tiene mucha deuda americana, pero también sabe que si vende demasiado rápido, el valor de sus propias reservas baja.
China holds a lot of American debt, but it also knows that if it sells too quickly, the value of its own reserves falls.
Es como tener demasiadas acciones de la misma empresa.
It's like holding too many shares of the same company.
No puedes vender todo sin dañarte a ti mismo.
You can't sell everything without hurting yourself.
Mutually assured financial destruction.
It's a phrase I never expected to be relevant outside of nuclear strategy, and yet.
Pero hay un cambio que sí preocupa a muchos economistas: China redujo su cantidad de bonos americanos en los últimos años.
But there is a change that does worry many economists: China reduced its holdings of US bonds in recent years.
No vendió todo de golpe, pero compró menos y vendió algunos.
It didn't sell everything at once, but it bought less and sold some.
Y otros países también empezaron a buscar alternativas.
And other countries also started looking for alternatives.
The de-dollarization conversation.
Which I'll admit I was somewhat skeptical of a few years ago, it felt like an academic exercise, but it's become harder to dismiss.
The BRICS countries in particular have been very vocal about wanting an alternative to dollar-denominated trade.
Y no solo los BRICS.
And not just the BRICS.
Muchos países de América Latina y África también quieren más independencia del dólar.
Many countries in Latin America and Africa also want more independence from the dollar.
El problema es que no hay una alternativa clara todavía.
The problem is that there's no clear alternative yet.
El euro existe, el yuan existe, pero ninguno tiene la misma confianza global.
The euro exists, the yuan exists, but neither has the same global trust.
I covered the euro's launch in '99, from Brussels, and even then people were asking whether it would one day challenge the dollar's dominance.
Twenty-five years later, the answer is: partially, in some regional contexts, but nowhere near a full replacement.
El euro tiene sus propios problemas, claro.
The euro has its own problems, of course.
La crisis de 2010 con Grecia, Portugal y España mostró que tener una moneda común sin una política fiscal común es muy complicado.
The 2010 crisis with Greece, Portugal and Spain showed that having a common currency without a common fiscal policy is very complicated.
Nosotros lo vivimos directamente.
We lived through that directly.
You did.
And the US looked at that crisis and I think quietly reassured itself that whatever its problems, the dollar wasn't going anywhere.
But forty trillion is a different kind of pressure than a European sovereign debt crisis.
Hay algo que mucha gente no sabe: los intereses de la deuda americana subieron mucho en los últimos años porque los tipos de interés subieron.
There's something many people don't know: America's debt interest payments rose a lot in recent years because interest rates went up.
Cuando la Reserva Federal aumentó los tipos para controlar la inflación, también encareció el coste de toda la deuda existente.
When the Federal Reserve raised rates to control inflation, it also made the cost of all existing debt more expensive.
That's the trap that I find genuinely alarming.
You tighten monetary policy to fight inflation, which is the right move, but you simultaneously make your debt burden significantly heavier.
It's a policy bind that doesn't have a clean exit.
Y el Congreso americano no llegó a un acuerdo fácil sobre el presupuesto durante muchos años.
And the American Congress didn't reach easy budget agreements for many years.
Cada año había una crisis, una amenaza de cierre del gobierno, negociaciones difíciles.
Every year there was a crisis, a threat of government shutdown, difficult negotiations.
No es un sistema que inspire mucha confianza en los mercados internacionales.
It's not a system that inspires much confidence in international markets.
The debt ceiling fights.
I was in Washington during a couple of those standoffs and I can tell you, foreign ambassadors were genuinely baffled.
The idea that a country would voluntarily flirt with defaulting on its own debt struck people as almost theatrically self-destructive.
En España tampoco entendemos bien ese concepto.
In Spain we don't really understand that concept either.
El Congreso americano vota para establecer un límite máximo de deuda, pero también vota para gastar más de ese límite.
The American Congress votes to set a maximum debt limit, but also votes to spend beyond that limit.
Es una contradicción que parece absurda desde fuera.
It's a contradiction that seems absurd from the outside.
It IS absurd.
It's constitutionally baked-in theater at this point.
Other countries just have their debt grow as a consequence of their spending decisions.
The US has decided to stage a separate drama about the consequences after the fact.
Entonces, ¿qué significa esto para el resto del mundo?
So, what does this mean for the rest of the world?
Para Europa, para España, para los países que comercian con Estados Unidos?
For Europe, for Spain, for the countries that trade with the United States?
Several things, and none of them particularly comfortable.
A weaker or less trusted dollar makes imports more expensive globally because so much commodity trade is priced in dollars.
Oil, grain, metals.
If confidence in the dollar erodes, that inflation gets exported everywhere.
Y los bancos centrales de todo el mundo tienen dólares en sus reservas.
And central banks all over the world hold dollars in their reserves.
Si el dólar pierde valor, esas reservas valen menos.
If the dollar loses value, those reserves are worth less.
España, como parte del Banco Central Europeo, también tiene este problema.
Spain, as part of the European Central Bank, also has this problem.
Which is the paradox at the heart of this whole conversation.
The world has a strong interest in America not bankrupting itself, even if some of those same countries would love to see American power diminished.
It's uncomfortable to be invested in the health of a rival.
Es una situación muy extraña, sí.
It's a very strange situation, yes.
Pero creo que hay algo que los americanos no piensan mucho: este nivel de deuda también limita lo que el gobierno puede hacer en el futuro.
But I think there's something Americans don't think about much: this level of debt also limits what the government can do in the future.
Si gastas mucho en intereses, tienes menos dinero para educación, infraestructura, defensa.
If you spend a lot on interest, you have less money for education, infrastructure, defense.
The crowding out problem.
And it's not hypothetical anymore.
There are genuine policy debates in Washington right now about which programs get cut, not because anyone wants to cut them, but because the interest bill leaves less room every year.
That's a real constraint on American power in a way that wasn't true even twenty years ago.
Oye, Fletcher, quiero preguntarte algo.
Hey, Fletcher, I want to ask you something.
Usaste antes la palabra 'billón' cuando describías la deuda, pero en inglés dijiste 'trillion'.
You used the word 'billón' when describing the debt earlier, but in English you said 'trillion'.
¿Sabes la diferencia entre 'billion' en inglés y 'billón' en español?
Do you know the difference between 'billion' in English and 'billón' in Spanish?
Oh.
Oh wait.
Is this one of those false friends situations?
Because I may have been doing the math wrong in my head for this entire episode.
Sí, es un falso amigo clásico.
Yes, it's a classic false friend.
En inglés, 'a billion' es mil millones.
In English, 'a billion' is a thousand million.
Pero en español, 'un billón' es un millón de millones, lo que en inglés se llama 'a trillion'.
But in Spanish, 'un billón' is a million millions, which in English is called 'a trillion'.
Entonces la deuda americana es cuarenta 'trillones' en inglés, pero cuarenta 'billones' en español.
So the American debt is forty 'trillions' in English, but forty 'billones' in Spanish.
So every time I've tried to say a billion dollars in Spanish and I said 'un billón' I was actually saying a trillion.
I've been accidentally overstating every number by a factor of a thousand.
That explains some confused looks I've gotten over the years.
Es un error muy común para los angloparlantes.
It's a very common mistake for English speakers.
Y también confunde a los hispanohablantes cuando leen noticias en inglés.
And it also confuses Spanish speakers when they read news in English.
La solución más fácil es usar 'mil millones' para 'billion' y reservar 'billón' solo para 'trillion'.
The easiest solution is to use 'mil millones' for 'billion' and reserve 'billón' only for 'trillion'.
Es más largo, pero más claro.
It's longer, but clearer.
Mil millones.
A thousand millions.
Honestly that phrasing is almost more honest about the scale of the thing.
Forty trillion dollars.
Forty billones.
Either way, it's a number that deserves more alarm than it seems to be getting.
Totalmente de acuerdo.
Totally agree.
Y la próxima vez que Fletcher hable de dinero en español, por favor, todos comprobad los números.
And the next time Fletcher talks about money in Spanish, please, everyone double-check the numbers.