Growing debt to strip USA of world's top economy status

The growing national debt will lead to the United States losing its status as the number one economy of the world and to the continued deterioration of its standard of living, with some other country overtaking the US's position, American investor Jim Rogers told Russian state-owned news agency Sputnik.

"In 100 years, it's going to be much worse. Young people in America are not going to have nearly as good a life as they had before. And some countries are going to rise to replace America as the number one," Rogers said. "What are the consequences? Continued decline in America's standard of living and in America's position in the world. It's happened to everybody. Every country that's been number one has made mistakes and spent a lot of money and gone into debt, has gone into decline."

Rogers recalled that 100 years ago, the United Kingdom was the number one country in the world, but then spent a lot of money, and went deep into debt.

"In 1976, they went bankrupt. Literally, the IMF had to fly into London and bail them out, give them emergency loans because they were bankrupt, horribly bankrupt," he recalled. "And the only thing that saved them was the North Sea oil. Then they discovered oil and the North Sea and that saved them. What does it mean? It means that other countries are rising ... America is going that way. But we don't have the North Sea oil to save us."

When asked about what country could overtake the US's place, the investor said that "it should be China," but expressed belief that certain currency constraints may prevent the country from topping the list of world economies.

"The Chinese currency is not convertible. It's not. It's blocked. The technical term, it's blocked. Well, you can't be number one with a blocked currency. It just cannot work," he added.

Rogers noted, however, that the Chinese are opening their currency and they're making it more tradable.
The US is teetering on the brink of a default of its obligations if the Biden administration fails to get its Republican rivals in Congress to agree to raising the nation’s debt ceiling.

The Congressional Budget Office warned on Friday that the United States faced a "significant risk" of defaulting within the first two weeks of June if lawmakers fail to increase the amount of debt the country is legally allowed to take on.

Talks between President Joe Biden and top lawmakers on raising the $31.4 trillion debt ceiling are expected to resume early this week, after a planned meeting on Friday was postponed to allow staff to continue negotiations.