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How to survive a national debt scare

An electronic billboard on a bus stop in Washington, DC, displays the current US national debt in white text against a blue and black backdrop; to the right, cars pass on the road.
An electronic billboard on a bus stop in Washington, DC, displays the current US national debt on August 30, 2026. | Jemal Countess/Getty Images for the Peter G. Peterson Foundation

The national debt hasn’t been a major issue in the 2026 midterms. But perhaps it should be. As of last month, the United States is in debt to the tune of $40 trillion. That’s 12 zeros, which averages out to about $116,000 per American. 

It’s enough that even economists like Jared Bernstein, the chair of the US Council of Economic Advisers under President Joe Biden, is starting to worry. Bernstein has long argued that the national debt is nothing to worry about too seriously as long as servicing it — that is, paying the interest on it — remains manageable. 

Bernstein has since changed his tune. He told Today, Explained co-host Sean Rameswaram after last month’s debt milestone that while the number itself is “a big distraction,” two factors have him worried: Congress’s inaction and rising interest rates. But is it well and truly time to panic? Are we in a moment of no return? 

Below is an excerpt of Sean’s conversation with Bernstein, edited for length and clarity. There’s much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify.

Have you now or ever been wrong about the national debt?

Yes. Who hasn’t?

Tell me what your position was and why you think it maybe was wrong.

A lot of the economic work on the national debt involves forecasting, predicting where things are going. And nobody can really forecast things like interest rates or when there’s going to be another recession or a war or a pandemic, so nobody could honestly answer that question with, “I’ve been right about everything.” 

But I feel good in the sense of being intellectually honest about how I’ve thought about this. When the numbers were pointing to a level of calmness about our fiscal outlook, even though lots of people had their hair on fire, I didn’t go there. I was pretty adamant that there wasn’t anything to be overly worried about at this point, for reasons that we can get into. 

When the numbers changed, and the outlook changed, and the politics changed, I changed.

Let’s start with why you thought it was okay to carry loads of debt in the first place, because that was your position for some time, right?

Correct. When you say loads of debt, the important thing is not just this load of debt or the stock of debt. Think of the debt as the water in the bathtub and think of the flow. Every year, you get a deficit or a surplus. That’s the water coming into the bathtub. 

If you have a large stock of debt or loads of debt, as you say, which we were carrying, what you really want to look at is: What’s the rate of interest? How much debt service do you have to pay to your creditors on that stock of debt? And as long as the interest rate stays pretty low and the country’s ability to service its debt is manageable, there’s no obvious reason to break out a sweat, even if there’s a lot of water in the bathtub. 

As long as you’re growing faster than your interest rate payments, as long as you’re not adding too much to the debt every year, underlying economic growth can allow you to service that debt without breaking a big economic sweat. And that’s where we were for a bunch of years. So that was the calm part.

Would you say you were part of an economic consensus in this country?

I would say yes, with an asterisk that maybe it was 50-50. Half of us who were watching it had hair that wasn’t burning up and the others had smoke coming out of their hats. 

By the way, there’s an interesting strain here that we shouldn’t miss because it becomes more and more relevant over time. Of the hair-on-fire group, there were two classes. One was genuinely freaked out, incorrectly in my view, and the other was a bunch of politicians who pretended to have their hair on fire, but really didn’t. 

“Don’t get hung up on the big, round number. It’s okay if your debt grows. It’s just not okay if your debt grows faster than your economy.”

These were — I used to call them chicken hawks. They were budget hawks, but they didn’t really want to do anything about it. And in fact, they consistently pushed in the wrong direction, which turned out to be kind of an important component of my apotheosis in this space.

Now, the big moment. Something happens at some point during this Trump administration that changes your mind. Tell us about it.

It wasn’t like at 2:37 pm on a particular day, just to be clear. I saw a number of things eroding and it wasn’t just during the Trump administration. 

Something flipped in my head a little bit because any kind of what we call a reaction function by Congress, to react to these unsustainable forecasts, looked dead to me. And then I started seeing some academic work that actually measured this and showed, lo and behold, Congress was no longer reacting to the budget outlook. That was part one. 

Part two is I started to see interest rates drift up. And if you’ll recall earlier, as I think you put it, interest rates found their way into the conversation. 

[Part three], we saw budget deficits that in normal times — the budget deficit, which again, that’s the water flowing into the tub — should be negative 2 to 3 percent. They’re 4, 5, and 6 percent. That’s almost a recessionary-level deficit. So you put those three things together and my head broke.

Do you think this congressional inaction or indifference to the debt was somehow seeded by decades of economists like yourself, saying, “This is okay”?

Let me flip that on you, because I don’t want to hold myself or my colleagues unaccountable, but I actually think the other side may be even more to blame or equally to blame in the sense of, they were saying the economy is about to explode for 30 years. And it didn’t. 

Now it is true that those of us — speaking for myself, I was saying, “We really ought to get our fiscal house in order, but we don’t need to worry about an immediate crisis. We have time to fix this.”

I was trying to be nuanced, but American politics doesn’t do nuance, so you can blame me for that.

Is the economy about to explode?

No. We still have time to fix this and the sooner we start, the better. 

When I talk about debt unsustainability and the potential for a debt spiral, I’m talking about over the next decade. I’m not talking about next week. The good news, Sean, is that there are ways to start repairing the damage. We can’t fill up the hole, but we can stop digging the hole. 

There are ways to stop digging the hole that are both good politics and good policy, and it has to do with reversing a bunch of tax cuts on the upper end of the income and wealth scale.

So what do we do? Do we just wait for a different administration?

That’s the answer for almost any good thing you want to do economically. I’m not saying this as a partisan: It’s very clear that this administration has caused all kinds of economic problems, but when you talk about the debt and deficit, I’ve tried to be pretty balanced in this conversation. 

It’s not just the [Republicans]. They’ve definitely made the biggest contribution to the unsustainable path through their relentless tax-cutting. But there was a time when I was in the Obama administration that we basically made permanent 80 percent of the Bush tax cuts. Republicans have been the lead flank in taking us to this unsustainable place, but too often the Democrats have not reversed those measures and in fact have, in some cases, endorsed them. 

And you seem to think that this is within reach, that we’re just a few steps away from making $40 trillion look more like $30 trillion or $20 trillion?

That’s an interesting question, because it’s probably making $40 trillion look more like $41 or $42 [trillion] rather than $44 or $45 trillion. 

But again, Sean, don’t get hung up on the big, round number. It’s okay if your debt grows. It’s just not okay if your debt grows faster than your economy. 

As long as the economy’s growing faster than the debt, which used to be the case, then that ratio’s going to come down. So it’s okay if the debt accumulates a little bit more. What’s not okay is if it just keeps spiraling and the growth rate decelerates.

So let’s keep it around $40 trillion. That’s the takeaway.

No, that’s not the takeaway. Sorry. I think $40 trillion is a big distraction. I’m not glad we’re there, but at least we’re talking about it. 

I think the key thing is the debt ratio, the debt relative to the economy. I think we can get back on a path where debt to GDP doesn’t just keep growing in good times and bad. It stabilizes in good times, maybe even comes down a little bit in good times because the economy’s growing faster than the debt — the denominator’s growing faster than the numerator, if you will. 

I think it’s plausible, but it would mean very different people, a very different composition of people in Congress and the White House.

My new takeaway is, “Keep the debt in check.”

Love it.

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Pluralistic: Workplace "flexibility" isn't (11 Jul 2026)


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Workplace "flexibility" isn't (permalink)

Here's an irony: the "gig economy" is a statistical black hole. Workers, customers and regulators know very little about the most basic aspects of it: how much workers get paid, for example, or much unpaid time on the clock a worker puts in before they get a job from the app.

The reason this is ironic is that the "gig economy" is dominated by a handful of massive, data-driven firms that know the precise, up-to-the-second answer to these questions. The problem is that they won't share the data. Of course, workers and customers have the data, too, but our data is widely diffused, with each worker and each customer only representing a single, infinitesimal pixel in this massive picture.

Most of our industry-wide figures about the sector come from painstaking, expensive survey work. The expense and effort involved in conducting this analysis means that the public's understanding of the gig companies' business is fragmentary and thin.

But every now and again, we get a flashbulb glimpse of the full picture. One of those glimpses was captured by David Weil, the former labor standards boss at the US Department of Labor. In 2024, the Massachusetts Attorney General sued Uber over worker misclassification, with Weil serving as an expert witness, who was able to access the raw data on Uber's business operations.

In a new American Prospect longread called "The Dangerous Myth of Flexibility," Weil builds on the public record developed in the case to demolish the central myth of the gigwork companies: that they enter into a mutually beneficial arrangement with their workers by offering "flexibility" that lets workers "choose work that fits the rhythms of their lives, not the other way around":

https://prospect.org/2026/07/09/dangerous-myth-of-flexibility-uber-lyft-gig-economy/

This quote comes from Tony West, the Uber executive who has led the company's efforts to formalize its worker misclassification program, notably California's Prop 22, a $225m statewide campaign that overturned the state's landmark gig work standards. West is also Kamala Harris's brother-in-law, and he served as her campaign's corporate liaison, senior strategist and economic policy advisor.

On its face, West's statement sounds reasonable, and most of us have heard a version of it, possibly even from an Uber driver. But what Uber calls "flexibility" is really a way for the company to offload its operational risks onto its drivers.

Anyone who runs a business has to manage a key operational risk: staffing levels. A restaurateur who doesn't schedule enough cooks, bussers and servers might have to turn away business at the door if there's a rush. But if the restaurateur schedules too many people for a shift, they'll end up paying for those workers to stand around scrolling Tiktok.

In America, Congress and state legislatures have created a system that allows restaurateurs to transfer this risk onto their employees: the "tipped minimum wage." Federally, the minimum wage for tipped employees is only $2.13/hour, with the caveat that employees are obliged to "top up" their workers' pay if the tips from their shift don't add up to $7.25/hour. So if you work five hours and don't wait on a single table, your boss has to pay you $36.25 ($7.25/hour * 5 hours). But if you have a busy shift and you make $40 in tips, your boss only has to pay you $10.65 ($2.13 * 5 – the tipped minimum).

This is a transfer of risk from bosses to workers. The boss can schedule extra servers and offload most of their wages to diners who come through the doors. If your boss overestimates the amount of business, much of the cost of that miscalculation comes out of your paycheck.

This is quite a sweet deal for bosses. After all, servers have virtually no control over the amount of business a restaurant attracts. It's the boss, not the server, who decides where the restaurant will be, which hours it will keep, which food it will serve, how much the food costs, what advertisements to run, and where and when to run them. The boss controls the decor, staff attire and the music. They make the decisions, and workers pay the price if they decide poorly.

For most businesses, workers are less exposed to risks from their boss's strategic errors. If your boss screws up, you might see a lower annual bonus, or take a career hit thanks to the bad company's presence on your CV. Of course, if your boss really messes up they might lay you off or go out of business altogether, but it's a rare business that gets to externalize its risks onto its workers on a shift-by-shift basis the way restaurants get to.

But as sweet as restaurateurs have it, that's nothing compared to the incredible deal that gig platforms get. Companies like Uber and Lyft get to shift nearly all their risk to their workers, and then insist that they're doing workers a favor by offering them "flexibility." Like a restaurateur, Uber and Lyft control all the mechanisms by which the number of riders is set. They decide how to advertise and how to price their rides. When a driver signs on and makes themselves available – at no charge – to Uber, it is the company's actions, not the driver's, that determine whether that driver gets a job, and how much they'll get paid.

Uber and Lyft claim that drivers have control, too – when (if) they're offered a job, they get to decide whether to take it. This is true, but it's more complicated than that. Drivers get about 15 seconds (!) to decide whether to accept a job, which means they have 15 seconds to calculate the mileage and time-based rate on offer, all while operating a vehicle in traffic. Drivers who accept lowball offers risk having their base pay permanently eroded through "algorithmic wage discrimination," which is when the gig platforms infer that workers who accept very low wages are economically desperate and can be offered even lower wages in the future:

https://pluralistic.net/2023/04/12/algorithmic-wage-discrimination/#fishers-of-men

But workers can't simply refuse offers and wait for the wage on offer to increase. That increase may happen, but if a driver is too picky, the platform will punish them for turning down too many offers by excluding them from future opportunities. If this happens often enough, the driver may end up broke enough to start accepting those lowballs, triggering the inexorable downward trajectory of their expected earnings.

This is "flexibility," but mostly it's flexibility for Uber, not for drivers. Uber controls when a driver gets paid, and they control the data about that payment. This allows Uber to claim to be paying well north of minimum wage, while drivers average less than $2.50/hour. Uber exploits its information asymmetry to publish only the numerator (the amount a driver makes when a passenger is in the car) while hiding the denominator (how many hours it takes for Uber to put a passenger in that car):

https://pluralistic.net/2024/02/29/geometry-hates-uber/#toronto-the-gullible

Uber has perfected a system of algorithmic pricing that allows it to dangle just enough money in front of drivers to maximize their number on the road, irrespective of how many riders are looking for cars. The fact that they have all the information (while drivers have none) allows them to extract vast amounts of totally unpaid labor from those drivers. And then, once a passenger gets in the car, Uber's informational systems let it pay that driver the absolute minimum they will accept for the ride.

Of course, it works the same way for passengers, each of whom is offered a different price for the same ride, based on the company's surveillance data and its realtime calculations about how much the rider is willing to pay. When Uber launched, driver pay and passenger fares were linked (the same way a server's tips and the cost of a meal are linked). Today, these are fully decoupled. Uber runs a kind of cod-Marxist operation where workers are paid according to their desperation, and passengers are gouged according to their ability to pay:

https://pluralistic.net/2025/01/11/socialism-for-the-wealthy/#rugged-individualism-for-the-poor

This works so well (for Uber) that Uber has launched a side hustle selling algorithmic pricing and algorithmic wage discrimination systems to companies in other sectors, so expect this arrangement to infect ever-wider swathes of the economy:

https://investor.uber.com/news-events/news/press-release-details/2025/Uber-Expands-AI-Data-Platform-to-Power-Next-Gen-Enterprise-and-AI-Lab-Needs/default.aspx

(And this is neither here nor there, but holy shit, is Uber's investor relations site seriously serving ASPX pages in 2026?! Hey Khosrowshahi, the DOJ called and it wants its Clinton-era antitrust evidence back!)

Back to algorithmic pricing: this opaque, take-it-or-leave-it algorithmic pricing arrangement sets Uber apart from other platforms where sellers offer temporary use of their property to buyers. As Weil writes, at least Airbnb hosts get to override the nightly rate suggested by the platform (though I'd add that the platforms will downrank and bury people who resist their suggestions).

As Weil points out, even if Uber had to pay the minimum wage and assume other operational risks associated with running a business, they'd still have access to these algorithmic tools, albeit with different parameters. Rather than setting the wage floor for drivers at $0/hour, they'd have to pay $7.25/hour (the federal minimum wage, or more, depending on the state). This would force the company to refuse shifts to drivers when there were enough workers on the road to handle demand, but drivers would benefit from this arrangement – rather than driving around for a shift, burning gas and putting wear on your car without getting paid, Uber would just tell you to stay home.

Uber could try to offload those risks onto passengers, but remember, Uber is already charging riders a personalized price based on massive troves of surveillance data that is continuously re-analyzed to guess the largest sum you're willing to pay for any given ride. You're already paying the highest price Uber can set for you, in other words.

Weil has been in many forums – including that Massachusetts courtroom – where Uber touted its "flexibility" as a benefit to drivers. But as he shows, Uber could offer all the same flexibility to drivers without the downside risk of driving around for hours without earning a dime. Sure, forcing Uber and Lyft to extend rights and protections that every employee gets would raise their costs – but "the same is true for any company having to comply with employment law and work protections."

Outside of the US, these companies are being forced to shift the risk from their workers' backs to their own balance sheets. As Weil writes, the UN's International Labor Organization has set binding labor standards for gig companies, called Convention 193, "Decent Work in the Platform Economy":

https://onlabor.org/a-win-for-platform-workers-ilo-convention-no-193/

The US government is pulling out all the stops to prevent these standards from being applied to US gig companies, even abroad. Trump's labor boss Keith Sonderling told the world that the US government "will not sit on the sidelines while some foreign governments push to hamper American innovation in the gig economy worldwide":

https://www.washingtonexaminer.com/opinion/3435961/america-must-lead-gig-economy/

But, as Weil says, this isn't about innovation, flexibility or AI. It's about gig companies changing the distributional outcome of whole sectors, to shift money from workers to investors.

The rest of the world has its own ideas. In Switzerland, the Supreme Court found that gig companies' businesses were illegal and ordered them to extend normal labor protections to gig workers. Naturally, the gig companies just ignored the law and continued to screw those workers. Gig workers, as noted, are diffused. They don't work in the same place. They have no way to find out who else works for the same boss as they do. The same factors that keep us from gathering stats on gig work also keeps gig workers from comparing notes on how they're getting shafted.

What's a labor organizer to do? The Swiss labor union Syndicom came up with an ingenious solution. They partnered with a popular, pro-union pizza restaurant, listed it on the delivery platforms, and then placed orders for tons of pizzas through the scofflaw food-delivery platforms. They transformed the pizzeria into a pop-up union labor hub, and had an organizing conversation with every rider the company dispatched to the restaurant:

https://vimeo.com/1203473793

This is deliciously ingenious, and the labor organizing need not stop there. Companies like Para have shown how, by jailbreaking the apps used by gig workers, they can allow those workers to comparison shop for the best wage. Rather than getting 15 seconds while navigating traffic to decide whether a job is worth taking, drivers and riders could use a "counter-app" that evaluates all the offers on all the platforms and coordinates with other workers to mass-reject lowball offers:

https://pluralistic.net/2021/08/07/hr-4193/#boss-app

The only problem is the "anticircumvention" laws that criminalize this kind of reverse-engineering and modifications of apps. These laws make it a literal crime to change how an app running on your own phone works. These laws were invented in America, with 1998's Digital Millennium Copyright Act, but in the ensuing years, the US Trade Rep has used the threat of tariffs to force every country in the world to adopt their own anticircumvention laws. By caving into US bullying, all of America's trading partners have left their workers and consumers vulnerable to technological surveillance, manipulation and price-gouging, to the great benefit of the US tech companies that have fused with the Trump regime.

This is the hidden silver lining to Trump's lunatic tariffs: they take away the threat that kept all those US-protecting foreign IP laws in force. When someone threatens to burn your house down unless you do as you're told, and then they burn your house down anyway, you really don't have to keep complying:

https://pluralistic.net/2026/01/01/39c3/#the-new-coalition

The possibilities for counterapps in gig work are endless. In Indonesia, gig rider co-ops commission "Tuyul" apps that mod their dispatch apps in ways small (upsizing the font) and large (spoofing the GPS):

https://pluralistic.net/2021/07/08/tuyul-apps/#gojek

In his article, Weil cites a study showing that customers for gig apps tend not to comparison shop – once you choose your default taxi-hailing app, that becomes your go-to. But with counter-apps, your default could be a price-comparison app that bids out your job to all the platforms and chooses the cheapest one, forcing the gig companies to compete with each other:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5729723

The platforms like to pitch themselves as "frictionless," but the reality is that they don't reduce friction so much as reallocate it. Because they control the technology, because the law makes it a literal crime to wrestle that control away, they can shift all the friction from their side of the ledger to yours, whether you're a worker or a customer:

https://pluralistic.net/2025/08/23/become-unoptimizable/#downward-redistribution

Tony West isn't lying when he says Uber values flexibility – they value their flexibility, which arises out of the constraints (technical, legal) they impose on us: the drivers and passengers.


Hey look at this (permalink)



A shelf of leatherbound history books with a gilt-stamped series title, 'The World's Famous Events.'

Object permanence (permalink)

#20yrsago Alanya to Alanya: feminist science fiction adventure https://memex.craphound.com/2006/07/12/alanya-to-alanya-feminist-science-fiction-adventure/

#20yrsago Soviet jokes https://web.archive.org/web/20060708144926/http://www.prospect-magazine.co.uk/article_details.php?id=7412

#10yrsago Empirical proof that Terms of Service are “the biggest lie on the Internet” https://web.archive.org/web/20160712233511/https://arstechnica.com/tech-policy/2016/07/nobody-reads-tos-agreements-even-ones-that-demand-first-born-as-payment/

#10yrsago Fox’s employee contracts may mean Gretchen Carlson will never get her day in court https://web.archive.org/web/20160712123858/https://thinkprogress.org/justice/2016/07/11/3797060/dirty-trick-fox-news-using-undercut-gretchen-carlsons-sexual-harassment-suit/

#10yrsago To see the future, visit the most remote areas of the GBAO https://medium.com/studio-d/6-1-glimpses-of-the-future-e3fdb510dcc1#.iwyo4x141

#10yrsago Benjamin Frisch’s “Fun Family”: good old American narcissism https://memex.craphound.com/2016/07/12/benjamin-frischs-fun-family-good-old-american-narcissism/

#5yrsago The Sacklers will get to keep billions https://pluralistic.net/2021/07/12/monopolist-solidarity/#sacklers-billions


Upcoming appearances (permalink)

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Recent appearances (permalink)



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Latest books (permalink)



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Upcoming books (permalink)

  • "The Post-American Internet," a geopolitical sequel of sorts to Enshittification, Farrar, Straus and Giroux, 2027
  • "Unauthorized Bread": a middle-grades graphic novel adapted from my novella about refugees, toasters and DRM, FirstSecond, April 20, 2027

  • "Enshittification, Why Everything Suddenly Got Worse and What to Do About It" (the graphic novel), Firstsecond, 2027

  • "The Memex Method," Farrar, Straus, Giroux, 2027



Colophon (permalink)

Today's top sources:

Currently writing: "The Post-American Internet," a sequel to "Enshittification," about the better world the rest of us get to have now that Trump has torched America. Fourth draft completed. Submitted to editor.

  • A Little Brother short story about DIY insulin PLANNING

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