Mary Meeker’s highly anticipated “USA, Inc.” report, released in March 2025 by Bond Capital, once again delivered a meticulously researched financial assessment of the United States. Following her seminal 2011 “USA Inc.” report, this 2025 iteration provides a critical updated snapshot, viewing the U.S. federal government through the lens of a corporate balance sheet and income statement. The core message remains consistent: America’s fiscal trajectory is a pressing concern, though the urgency and prescribed solutions vary wildly depending on one’s economic philosophy.
The original 2011 “USA Inc.” report served as a stark wake-up call, highlighting accelerating debt accumulation and growing unfunded liabilities, particularly in Social Security and Medicare [1]. It laid out a business-like accounting of the nation’s finances, suggesting that without significant changes, the U.S. was heading towards an unsustainable path.
Themes and Key Findings from USA, Inc. 2025
Fast forward to March 2025, and the latest “USA, Inc.” report paints a picture of deepening fiscal challenges. The delta from 2011 is not merely a quantitative increase in debt; it’s a qualitative shift where previously projected liabilities have materialized and accelerated, exacerbated by recent global events and policy responses.
Key findings and themes from the USA Inc. 2025 report:
Escalating National Debt: The national debt has surged to levels exceeding historical peaks relative to GDP, projected to continue its upward trajectory [2]. Figure 3
Crowding Out by Interest Payments: A significant and alarming finding is the rapid growth in net interest payments on the debt, which are now consuming an ever-larger portion of the federal budget, crowding out other critical federal investments like infrastructure, education, or defense [3]. Figure 4
Accelerated Unfunded Liabilities: The “epic” and rising nature of off-balance sheet liabilities, primarily for entitlements like Social Security and Medicare, continues to be a central theme. These commitments amount to multiples of the on-book debt, a warning bell that was already ringing in 2011 but is now blaring louder [1, 4]. Figure 2
Deteriorating Net Worth: Mirroring a corporate entity, the report likely shows a continued deterioration of USA Inc.’s net worth, implying a diminished financial flexibility to handle future national crises or unexpected economic shocks [1]. Figure 1
Figure 1 Deteriorating Net Worth, USA Inc.Figure 3 Escalating National Debt, USA Inc.
Figure 2 Unfunded Liabilities, USA Inc.Figure 4 Crowding out by interest payments, USA Inc.
Economic Interpretations: A Spectrum of Views
This grim outlook, however, isn’t universally accepted. Mainstream economics broadly encompasses traditional (neoclassical) views and Keynesian economics. Traditional economists often emphasize the importance of balanced budgets, fiscal discipline, and minimal government intervention, fearing that large deficits lead to crowding out of private investment and inflationary pressures. Keynesian economics, while acknowledging the long-term need for fiscal sustainability, emphasizes the role of government spending in stimulating demand during economic downturns, arguing that deficits can be beneficial when the economy is operating below its potential.
Modern Monetary Theory (MMT) represents a more heterodox, almost “post-Keynesian,” perspective. MMT posits that a sovereign government, which issues its own fiat currency, cannot technically “run out of money” and therefore isn’t constrained by debt in the same way a household or business is [6]. From an MMT perspective, the numbers presented in “USA, Inc.” might be seen not as an impending crisis, but rather as an accounting of necessary public spending to achieve societal goals, with inflation being the true constraint, not debt levels. Proponents of MMT would likely argue that government spending creates the very financial assets that fund the debt, and that fears of “crowding out” are overblown for a currency issuer [6].
Support for MMT remains a minority view [10] within the broader economics community. While it has gained increased public discussion, particularly since the 2008 financial crisis and in response to discussions around large-scale public spending, most mainstream economists, including many Keynesians, remain skeptical of its core tenets regarding government debt limits. They typically acknowledge a currency-issuing government’s ability to print money but emphasize the severe inflationary and currency devaluation risks associated with doing so without corresponding real economic output [7].
Conversely, mainstream economists and fiscal conservatives, supported by research from institutions like the Congressional Budget Office (CBO) [2], Brookings Institution [3], and the Peter G. Peterson Foundation [4], see the escalating debt as a significant long-term threat. These analyses consistently project that without policy changes, deficits will remain unsustainably high, leading to increased interest costs that consume a growing share of the federal budget.
The Impact If Nothing Is Done
If the trends highlighted in “USA, Inc. 2025” remain unaddressed, the potential economic ramifications could be severe and far-reaching:
Increased Taxes and/or Reduced Public Services: To service the growing debt, the government would eventually face difficult choices: raise taxes, cut spending on essential public services (like education, infrastructure, or defense), or a combination of both [5, 9].
Crowding Out of Private Investment: As the government borrows more, it competes with the private sector for available capital. This can drive up interest rates for businesses and consumers, making it more expensive for companies to invest and expand, ultimately stifling innovation and economic growth [5].
Stagflation Risk: An uncontrolled increase in the money supply to finance deficits, coupled with supply-side constraints, could lead to stagflation—a damaging combination of stagnant economic growth, high unemployment, and rising inflation [8].
Devaluation of the Dollar: Sustained large deficits and a perceived inability to manage debt could erode international confidence in the U.S. dollar. This could lead to a devaluation of the currency, making imports more expensive, reducing purchasing power for Americans, and potentially undermining the dollar’s status as the world’s reserve currency [9].
Reduced Fiscal Flexibility: A high debt burden leaves the government with less capacity to respond to future crises (e.g., pandemics, natural disasters, economic recessions) without further destabilizing its finances [2, 5].
The Importance of Government Financial Literacy
The underlying message of “USA, Inc.” – both the 2011 and 2025 versions – transcends partisan economics: government financial literacy is paramount. For citizens to make informed decisions and hold their elected officials accountable, a basic understanding of the nation’s financial statements is crucial. Meeker’s report, while crafted with an investor’s precision, is seemingly intended for a broad audience, distilling complex financial data into digestible charts and narratives.
Paradoxically, while the report aims for public comprehension, its detailed nature means it will likely be consumed and debated most rigorously by researchers, academics, economists, and financial industry professionals. Yet, those who will be most profoundly impacted by the underlying fiscal events – average citizens whose future taxes, public services, and economic opportunities are at stake – may be the least likely to fully engage with or understand the nuances of the document. This highlights a critical challenge: translating complex fiscal realities into actionable insights for the very public it seeks to inform. While there maybe disagreement over the impact, the trends and path are troubling and we hope that all Americans make informed choices regarding America’s future.
[7] Mankiw, N. G. (2020). A Skeptic’s Guide to Modern Monetary Theory. NBER Working Paper No. 26650. National Bureau of Economic Research. https://www.nber.org/papers/w26650
As we approach the United States’ 250th Semiquincentennial next year, a monumental shift in our nation’s economic strategy is underway. President Trump’s recent executive order to create a U.S. Sovereign Wealth Fund (SWF) marks a pivotal moment in American financial history[2][4]. At the Tax Project Institute, we have long discussed the potential benefits of a national investment account in the form of a SWF, recognizing its transformative potential for our economy (See our Article on Sovereign Wealth Funds here).
A Sovereign Wealth Fund is a state-owned investment fund that manages a country’s excess reserves, typically derived from natural resource revenues, trade surpluses, or other sources of national wealth. These funds are designed to invest in a diverse range of assets, both domestic and international, to generate returns and support long-term economic objectives. Much like a national investment account, it grows and compounds over time, and as it grows it becomes of source of revenue offsetting the need for things like additional taxes.
The creation of a U.S. SWF is a watershed moment that may be viewed by future generations as one of the most impactful acts in American history, comparable to the Louisiana Purchase, the Emancipation Proclamation, or the New Deal. Just like a savings and investment account, it doesn’t sound or look like much now, but in 50 or 100 years it could be game changing, and looked at in the same way as other major acts. While it won’t immediately solve our national debt issues or eliminate budget deficits, it could be the first step towards putting our country on a more substantial economic footing.
What are they for?
Sovereign Wealth Funds serve various purposes across the globe. Some of the key areas where SWFs are utilized include:
Economic Diversification: SWFs help countries reduce their dependence on a single sector or resource by investing in a wide range of industries and assets.
Intergenerational Savings: They can preserve wealth for future generations, especially in countries with finite natural resources.
Stabilization: SWFs can act as fiscal stabilizers during economic downturns or when commodity prices fluctuate.
Strategic Investments: They allow countries to invest in key industries or technologies that align with national interests.
Infrastructure Development: Many SWFs focus on funding critical infrastructure projects both domestically and internationally.
In short, they are investment accounts run by the country, and the hold the potential to fund significant portions of future expenses, and offset revenue short falls.
What it means for the U.S?
The U.S. SWF has the potential to become the largest in the world, given the size and strength of the American economy. As of 2025, the largest SWF is Norway’s Government Pension Fund Global, with assets under management of $1.78 trillion[6]. The U.S. fund could potentially surpass this figure, leveraging the country’s vast economic resources and global influence.
The implications of a U.S. Sovereign Wealth Fund are far-reaching:
Enhanced Global Economic Influence: A large U.S. SWF would significantly increase America’s economic clout on the world stage, potentially rivaling or surpassing the influence of other major SWFs from countries like China, Norway, and the UAE[6].
Domestic Investment: The fund could be used to finance critical infrastructure projects, support emerging industries, and drive innovation within the United States.
Long-term Fiscal Planning: A well-managed SWF could provide a cushion against economic downturns and help address long-term fiscal challenges.
Wealth Distribution: If structured appropriately, the fund could potentially provide direct benefits to American citizens, similar to Alaska’s Permanent Fund[4].
Strategic Acquisitions: The fund could be used to acquire stakes in strategically important companies or technologies, as hinted at by the potential involvement in TikTok[2][4].
Market Impact: The sheer size of a U.S. SWF could have significant effects on global financial markets, potentially influencing asset prices and investment trends
While not a panacea, a SWF offers significant Economic flexibility at scale to offset and provide services in a number of ways to minimize economic shocks, like the 2008 Great Recession or the COVID pandemic, or offset expenses on long term items like infrastructure, or potential pending large scale changes in the market, like AI offsetting white collar jobs.
Global Context
As we consider the potential of a U.S. Sovereign Wealth Fund, it’s important to look at some of the largest existing SWFs for context:
Country
Fund
Value
Norway
Norway Government Pension Fund Global
$1.78 Trillion
China
China Investment Corporation (CIC)
$1.3 Trillion
Abu Dhabi
Abu Dhabi Investment Authority
$1.05 Trillion
Kuwait
Kuwait Investment Authority
$1 Trillion
Saudi Arabia
Public Investment Fund
$925 Billion [6]
These funds have played crucial roles in their respective countries’ economic strategies, from Norway’s focus on preserving oil wealth for future generations to China’s efforts to diversify its foreign exchange reserves. Given that the US GDP is almost 13 times larger than Norway, you can see the potential size of the fund and the proceeds that it maybe able to throw off. Just doing simple math lets say the US SWF reaches $20 trillion, taking 4% annually from the fund to reinvest on Americans (offset taxes, new infrastructure, services, direct payments, etc.) could lead to $800 billion in annual offsets. Given the unending demands on government budget, this won’t solve our problems, but it can certainly help.
Summary
The creation of a U.S. Sovereign Wealth Fund represents a paradigm shift in how America approaches its economic future. As Treasury Secretary Scott Bessent explained, “It will include a mix of liquid assets and resources that we possess domestically as we aim to make them available for the American populace.”[4] This approach could unlock significant value from government assets and activities that have previously been underutilized.
However, the establishment of such a fund is not without challenges. Proper governance structures, transparency measures, and regulatory frameworks will be crucial to ensure the fund operates in the best interests of the American people. As a 2024 study by the Carnegie Endowment for International Peace warned, without appropriate safeguards, sovereign wealth funds could potentially become “vehicles for corruption, money laundering, and other illegal activities.”[4]
The development of the U.S. SWF over the next year will be a process closely watched by economists, policymakers, and global investors alike. Its potential to reshape America’s economic landscape and global financial influence cannot be overstated. As we celebrate our nation’s 250th anniversary, the creation of this fund may well be remembered as a defining moment in our economic history.
In conclusion, the establishment of a U.S. Sovereign Wealth Fund represents a bold step towards securing America’s economic future. By leveraging our nation’s vast resources and economic power, this fund has the potential to drive innovation, support critical investments, and ensure long-term fiscal stability. As we move forward, it will be essential to strike a balance between ambitious growth and responsible management, ensuring that this new economic tool truly serves the interests of all Americans for generations to come.
If subjected to the guidelines that individual borrowers must follow, how would the US do?
While this question is pure folly, and clearly just a hypothetical question with no real world application. However, at the Tax Project we thought it would be a good thought exercise in something that most Americans are familiar with to understand their own credit worthiness, and often take a sobering look at their own finances and in doing so assess the state of our country in something more tangible and relatable.
We also realize that there are very sizable and distinct differences that don’t make the comparison likely, but there were enough similarities that we thought it would be instructive to review. First, let’s get the caveats out of the way that illustrate the folly of a real comparison. While the US has many other advantages, these are big ones:
Power of Taxation1 – The US has the unlimited ability to Tax, through any source, to raise funds.
Reserve Currency – As the World’s reserve currency (See Article: Reserve Currency) the US is in a unique position to print money to raise funds in their own fiat currency. While this may devalue the dollar, the ability to print more is undiminished.
Assets – The US has tremendous assets. The Federal government owns more than a quarter of US land, over 600 million acres3. They have a sizable Real Estate Portfolio, Cash Reserves4, Strategic Oil reserves up to 700 million barrels5, substantial Mineral, Oil and Gas rights some of the largest in the world6, and a huge number of physical assets including an estimated $11 billion in Gold reserves alone and these are just to name a few. In short, the US has considerable assets as collateral.
All the caveats aside though, the US debt to income ratio, the long term debt, credit worthiness, and other metrics are all fair game to look at to ponder this question and understand and get a sense of how our country is doing financially. So, to put this question to the test, we asked an experienced Mortgage Broker to process the US Mortgage application, and here was her response:
Susan Weber Pomilia
Susan has had over 30 years experience in the Mortgage Broker lending business, and has held leadership positions at several leading Finance companies and is currently a Regional Manager at Supreme Lending. Susan is a Director at Hennessy Advisors a Financial Services firm managing $4 billion in Assets Under Management. Susan is an Advisor for the Tax Project Institute.
To find out, let’s break down the typical guidelines for an individual qualifying for a mortgage and then consider how they might apply when comparing them to the country as a whole. There are several tests, as follows, to determine an applicant’s credit worthiness, and each MUST pass to qualify.
Lending Criteria
Credit score: Individuals can obtain a mortgage with a minimum credit score of 580, but to obtain the lowest interest rate available, most Investors require a score of 760. Similarly, a country might be evaluated based on its credit rating, which reflects its ability to repay debts. As of November of 2023, Moody’s is the only rating agency that maintains the US’ Federal Government Bond ratings at AAA credit rating (Highest rating, low risk) but downgraded their outlook for the future to “Negative”8. This means they believe the country’s rating will soon drop. Both Fitch and Standard & Poor’s rate the US at AA+9,10. Even based on a reduced rating of AA+, the US would meet the credit score guideline, but may not secure the best terms or the lowest interest rate.
RESULT: PASS (albeit at a higher rate and cost)
Income and Debt-to-Income Ratios: Mortgage lenders calculate an individual’s gross monthly income and their monthly debts to determine their Debt-to-Income (DTI) ratios. Dividing the total debts by the gross income determines the DTI percentage. Lenders typically require a DTI of 49% or below. For a country, this could translate to evaluating its Gross Domestic Product (GDP), a measure of a country’s total economic output, and its Debt-to-GDP ratio. According to the US Bureau of Economic Analysis (BEA) the US GDP for Q1 2024 was $28.26 Trillion11. As of 6/10/24 the US National Debt according to the US Treasury has soared to $34.7 Trillion12. Based on this the DTI for the US would be: 122%. The US would need to be at a ratio of 49% or below to qualify, so based on the 122% ratio, the US would not meet the DTI guideline and would therefore not qualify for a home loan.
RESULT: FAIL
Employment Stability: Lenders look at an individual’s employment history and stability. They typically require 12 months of employment in the same job and two years in the same field. Similarly, a country’s employment rate and stability of its job market could be factors in determining its mortgage eligibility. The US’ current employment rate or labor force participation rate is 62.50%13, which is lower than the long-term average of 62.84%. The unemployment rate currently sits at 4.00%14. There are 6.6 Million people unemployed15 today (people that are looking for work but can’t find jobs). Yet surprisingly, the US job market has remained resilient with 272,000 new jobs added in May15. Based on the current data, the US would meet the employment stability requirement. RESULT: PASS
Down Payment: Individuals typically have a down payment of 5% to 20% of the sale price when purchasing a home. For a country, this could be compared to its ability to make an initial payment or provide collateral. Countries with substantial reserves would have an easier time securing a mortgage. The US has $241 Billion16 in reserves alone, without the collateral mentioned above. Based on this number, the US would meet the reserve guideline. RESULT: PASS
Property Appraisal: Lenders will have the property being purchased (collateral for the mortgage) appraised to ensure its value supports the requested loan amount. Lenders will then compare their Loan amount to the appraised Value known as a Loan-to-Value (LTV) ratio. Lenders will lend between 80% to 97% of the sales price in most cases but will offer more favorable interest rates with a lower LTV. In the case of the US, we should look at the total value of improved real estate, which is $47 Trillion17, while the amount of mortgage debt the country carries is $20.2 Trillion18. The LTV for the US is 42.9%, which is low. For this reason, the US would qualify under the appraisal guidelines. RESULT: PASS
Interest Rates: Individual mortgage rates are influenced by market conditions, credit cycles globally and the US central bank, the Federal Reserve, and the borrower’s risk profile as detailed above. A country’s mortgage rate would be influenced by global economic factors and its perceived risk as a borrower. If the US did qualify for a loan, their rate would likely be below that of the best customers with higher credit ratings based on the credit ratings agencies outlook for the US and collateral and material advantages as a Sovereign nation. However, the very high Debt to Income ratio could be cause for concern amongst lenders potentially increasing rates.
Conclusion
As we’ve seen, qualifying for a mortgage isn’t easy, even for a nation as powerful as the United States. While the US would NOT pass a traditional mortgage test due to its high debt-to-income ratio, its unique position allows it to borrow money in ways individuals can’t. However, this exercise highlights the importance of fiscal responsibility for any entity, even a government.
Unlike an individual mortgage default, a sovereign debt crisis can have far-reaching consequences, impacting global markets, economic stability, and disrupting the lives of its citizens. While the US isn’t facing imminent danger, the long-term outlook requires addressing our debt and investing in our future.
We hope this thought exercise sparked your interest in US fiscal health. Here are some resources for further exploration:
Tax Project Institute is a fiscally sponsored project of MarinLink, a California non-profit corporation exempt from federal tax under section 501(c)(3) of the Internal Revenue Service #20-0879422.
