Rising Gold Prices Underscore Uncle Sam's Spending Problem

Ken Buck
Tue, 10 Feb 2026 15:09:04 -0800
Opinion

Anything that is "worth its weight in gold" is worth a lot more these days, and Washington's insatiable appetite for spending is to thank — or, more appropriately, to blame.

For decades the U.S. dollar served as the "world's currency." After the end of World War II, the dollar replaced the British pound as central banks' primary reserve capital because it was considered the most stable form of money, backed by the full weight of the American government.
Updated: Wed Feb 11, 2026

Anything that is "worth its weight in gold" is worth a lot more these days, and Washington's insatiable appetite for spending is to thank — or, more appropriately, to blame.

For decades the U.S. dollar served as the "world's currency." After the end of World War II, the dollar replaced the British pound as central banks' primary reserve capital because it was considered the most stable form of money, backed by the full weight of the American government.

Today, that backing doesn't inspire the same confidence. Our unbridled national debt — which, at $38.5 trillion, now exceeds U.S. GDP — has eroded the dollar's value and sparked warranted skepticism that it may ever rebound. The three major credit rating agencies have downgraded the United States' rating since 2011, all citing our country's high debt burden and the lack of political fortitude to address it.

Moody's, which downgraded its rating last year, noted: "Successive US administrations and Congress have failed to agree on measures to reverse the trend of large annual fiscal deficits and growing interest costs. ... The US' fiscal performance is likely to deteriorate relative to its own past and compared to other highly-rated sovereigns."

In other words, the U.S. government has a spending problem and no will to correct it. And the world notices.

Around the globe, foreign banks are ditching the dollar and buying up gold to limit exposure to potential volatility. Banks bought more than 863 tons of gold last year and over 1,000 tons the year before. Coupled with investors — who are buying for the same reasons — the rush to exchange paper money for gold pushed its value above $5,000 per ounce for the first time ever this year.

Elon Musk, who spearheaded President Donald Trump's admirable but ultimately lackluster Department of Government Efficiency waste-cutting initiative, cautioned last week that the U.S. will "1,000 percent" go bankrupt on its current trajectory. He suggested artificial intelligence is the only way to begin paying down our debt, and he may be right.

Lawmakers have shown little courage to stand up and tell it like it is: Either the government must significantly slash spending, raise taxes, or both. Otherwise, our country will run itself off a fiscal cliff, forfeiting our standing as a global leader and bringing down real economic hardship on everyday Americans.

Right now, every U.S. resident is about $115,000 in debt thanks to Washington, and that number is rapidly climbing. The national debt is growing by about $70,000 per second. Interest costs, which exceed national defense spending, are now the fastest-growing piece of the U.S. budget.

Washington's reckless spending is hardly new, but it wasn't helped by former President Joe Biden's extravagant stimulus packages — which pumped Monopoly money into the economy, driving up inflation and worsening the affordability crisis. In 2024 nearly 40% of U.S. households worried they wouldn't be able to afford their bills.

Republicans, who have long championed fiscal responsibility, aren't behaving much better. While last year's Big Beautiful Bill kept more money in taxpayers' pockets, it also added over $4 trillion (or more, according to some estimates) to the debt over the next decade. And that is if Congress really makes the cuts it promised, which is unlikely.

Lawmakers have a knack for postdating budget cuts — usually to say they both cut spending and protected those who benefit from it. It's classic doublespeak. But when it comes time for those cuts to take effect, Democrats vote to keep them in place if they control power, or deride Republicans for hurting the "most vulnerable," if they don't have power. The result is, the spending continues unabated.

Instead, Congress and every incoming and outgoing administration is spending like their political careers depend on it. There are real costs to this unreal ignorance. Lawmakers are saddling our children with untenable debt, setting them up for huge tax increases down the road. They are building dependence on big government programs — even as many teeter on insolvency — edging our country toward socialism.

There are no easy answers. But there are obvious ones. Lawmakers must get serious about cutting spending. They have to be real about raising taxes if they won't. And they need to be honest with voters about those hard truths, even if it costs them their jobs.

Washington is spending its way toward financial ruin, which should alarm all Americans — even those who own gold.