Bessent: 3% GDP Growth Could Help Ease U.S. Debt Burden

U.S. Treasury Secretary Scott Bessent said the United States could rely on economic growth to ease its debt burden if annual GDP growth reaches 3%. According to Sina Finance, he made the remarks during a question-and-answer session at the Cox School of Business at Southern Methodist University in Dallas. Bessent said the problem is not revenue but spending, and added that if the United States controls fiscal spending and combines that with 3% growth, it can work its way out of debt. He said U.S. national debt has topped $40 trillion, and that the fiscal year ends on September 30, with the annual budget deficit expected to exceed $2 trillion. He also said the U.S. underlying economy is strong after the Iran conflict settles, and that he believes growth will accelerate again. Bessent said large tax legislation passed last year has created incentives that are driving new factory construction, citing PepsiCo's Frito-Lay expansion in Arizona, Winnebago's purchase of a battery factory, and Boeing's efforts to raise Dreamliner production. Bessent said AI-driven construction jobs will later turn into manufacturing jobs, and that skilled trades such as carpentry and electrical work have already created more jobs for U.S. workers without college degrees than new jobs for college graduates. He also said he is working with Office of Management and Budget Director Russ Vought on a fiscal consolidation plan to reduce the deficit. He said the Treasury will expand bond buybacks, described the operation as a way to absorb the most liquid parts of the bond market and inject cash, and said current interest rates and energy prices are highly correlated. Bessent added that oil markets could move into surplus within one to two years as the United States and Venezuela build energy cooperation and the Middle East returns to normal. He also said AI has pushed the number of newly founded small businesses to a record high.