We hear about the national debt hitting trillions, but why? Government debt exists because politicians like to spend money they don’t have.
It is simple math: If a country collects $1 trillion in taxes but spends $2 trillion on wars and social programs, it has a deficit. It must borrow the difference.
Who does it borrow from? Often, it borrows from other countries, or increasingly, from its own Central Bank (which prints the money to lend it).
This creates a trap. To pay off the interest on the old debt, the government has to borrow even more new debt. It is a spiral that never ends.
Eventually, the debt gets so big it can never be paid back. The only options are to default (tell lenders “sorry”) or print money to inflate the debt away (pay back in worthless currency).
Bitcoin is an escape from this government debt spiral because it cannot be printed to bail out irresponsible spending.