Financial Crisis Warning: Former FDIC Chair Reveals Debt Now ‘Unsustainable’ | Sheila Bair

The episode explores the implications of rising U.S. national debt and potential economic vulnerabilities with Sheila Bair, former chair of the FDIC. Bair warns that continued deficit financing could lead to investors demanding higher risk premiums, spiking government borrowing costs, and crowding out other federal budget areas. She highlights the risk of financial system instability, referencing the Silicon Valley Bank failure as an example of losses on government securities leading to collapse. Bair also addresses Social Security's looming trust fund shortfall, advocating for immediate action to leverage the benefits of compound growth. While acknowledging potential for trimming the federal workforce, she cautions against impairing essential government functions and suggests focusing on rent-seeking in areas like healthcare, student loans, and defense spending.