In the report, we presented a series of data on the public debt of various countries between 2014 and 2025. As demonstrated by a graph, the 2020 pandemic caused the debt-to-GDP ratio to soar everywhere.

We have commented on its trend in the USA, at levels never reached before.

The increase was caused by two simultaneous factors: on the one hand, the enormous expansion of public spending to support businesses, healthcare systems, and households; on the other, the collapse in GDP due to the paralysis of the global economy. In the following years, many countries recovered part of the increase in debt thanks to economic recovery and inflation, which helped increase nominal GDP, reducing the relative burden of debt.

Germany remains a "virtuous" country: between 2014 and 2019, it reduced its debt from 74.5% to 58.7% of GDP. Even after the pandemic, it remains close to 60%, well below other countries. Japan continues to be the most indebted country, consistently above 230% of GDP throughout the period. China went from a ratio of 39.3% in 2014 to almost 90% in 2025. France showed a steady deterioration over the decade: from 96.2% in 2014 to 115.6% in 2025. Italy remained among the most indebted countries: throughout the period, the debt-to-GDP ratio fluctuated around 134%, peaking at 154.4% in 2020. After the pandemic, the figure gradually declined, but in 2025 it returned to 137.1%.

The United States saw its debt increase by about 20% in 2025 compared to 2024. According to Trading Economics, in March 2026, nominal US debt reached an all-time high of $39.1 trillion.

In 1944, the United States, in New Hampshire, at Bretton Woods, at a time when they produced a large portion of the world’s goods, much of which had been destroyed by the Second World War, with their absolute supremacy managed to establish the dollar as the world’s reserve currency. This was the dawn of a period that French Finance Minister Valéry Giscard d’Estaing, in the 1960s, called an "exorbitant privilege": borrowing without too many constraints and paying for goods and debts with paper they printed themselves.

This advantage rested on widespread confidence in the financial stability of the United States: almost everyone trusted that Washington would honor its debts, keep the dollar stable, and preserve Treasury securities as the safest haven, without ever using this power against its creditors. For decades, this stability held, certainly not due to the moral merits of American capitalists, but rather out of pure convenience, as the mechanism benefited too many international players to be questioned.

Since August 1971, when the Bretton Woods agreements were breached, ending the dollar’s convertibility into gold, the world economy entered a new phase. The dollar ceased to be tied to a material base like gold and began to base its dominance solely on the economic, political, and military strength of the United States. In the years that followed, the international capitalist system thus found itself directly or indirectly supporting America’s trade deficits and Washington’s growing public debt, further fueled by the maintenance of a gigantic military apparatus.

A significant shift occurred in 1974, when the United States and Saudi Arabia signed a strategic agreement that would shape the global economic order for decades. In exchange for American military protection and arms supplies, the major Gulf oil producers agreed to sell their crude oil exclusively in dollars and to reinvest a significant portion of their profits in US government bonds. Thus was born the so-called "petrodollar" system, which guaranteed the United States constant demand for both its own currency and US Treasuries, allowing it to finance its debt at relatively low costs.

Today, however, this mechanism is showing increasingly evident signs of wear and tear, due to various factors.

One of these is the transformation of the United States from an importer to a leading exporter of oil. Thanks to the growth of shale extraction, it has become one of the world’s leading oil and gas producers, significantly reducing its historical energy dependence on the Middle East. This has altered the traditional privileged relationship with the Gulf monarchies.

Although Saudi Arabia and the United Arab Emirates are still among the largest foreign holders of US government bonds, this situation is gradually leading them to reduce their dollar reserves, both due to reduced domestic financing needs and a desire to diversify their investments.

Furthermore, military operations in Iran, without any real involvement from their allied Gulf monarchies, have undermined their confidence in being able to rely on American protection.

While until a few years ago, almost all global crude oil was paid for in dollars, today a growing share of transactions are conducted in yuan, rubles, rupees, and, to a lesser extent, euros. China in particular is working to strengthen the yuan’s international role by promoting trade agreements in local currencies and building alternative financial infrastructures to the US-dominated system.

Among these is the mBridge project, launched in 2022 under the auspices of the Swiss-based Bank for International Settlements, a cross-border payment platform for trades in the digital currencies of the central banks of China, Hong Kong, Thailand, Saudi Arabia, and the United Arab Emirates. The infrastructure, which enables secure, instant, cost-effective, and universally accessible payments, is independent of the Swift circuit, and therefore the dollar, thus reducing its need as an intermediary in trades.

This context also includes the strengthening of the BRICS, initially composed of Brazil, Russia, India, China, and South Africa, and now expanded to include new members and strategic partners. These national capitalisms—which, in truth, have little else in common—aim to reduce their dependence on the dollar in international trade.

Global dollar reserves, which in the 1970s accounted for approximately 85% of the total, are therefore slowly shrinking, a gradual process that could accelerate due to the United States’ abuse of its financial power as a political tool.

According to a recent report from Deutsche Bank, tensions and conflicts in the Middle East are putting pressure on some of the historical foundations of the petrodollar. Analysts are openly speaking of a potential "perfect storm" for the US-dominated monetary system.

The question, therefore, does not seem to be whether the dollar will lose some of its global centrality, but how quickly this transformation will occur and what the economic, social, political, and military consequences will be for the United States and the entire global system.

For decades, the United States has benefited from the dollar’s role in exerting a decisive influence on the global economy. However, this very use of the dollar as a tool of pressure—for example, the freezing of Russian central bank reserves following the conflict in Ukraine—is pushing many countries to seek alternatives.

Today, the largest foreign holders of US government debt are Japan and China. The ongoing transformation of these two countries’ securities portfolios appears to be informed by gradual, long-term strategies. The reduction in US debt exposure appears to be driven not by panic or a temporary crisis, but by decisions matured over time.

China, for example, held approximately $1.3 trillion in U.S. Treasury securities in 2013; today, it has fallen below $760 billion, a significant reduction, but one that has occurred over a decade. Japan, while still the largest foreign holder of U.S. debt, is also gradually reducing its exposure: in the third quarter of 2024, Japanese investors sold nearly $62 billion in Treasuries; China sold over $51 billion in the same period.

But when two of the world’s largest creditors simultaneously move in the same direction, the phenomenon inevitably takes on a deeper meaning. There are certainly financial technical reasons behind this. In the case of Japan, the central bank’s change in monetary policy has made domestic investments in yen more attractive, reducing interest in dollar-denominated bonds and the risk associated with currency fluctuations.

But the reasons aren’t just financial. More and more investors are watching with concern the trajectory of US public debt and the interest payments, which have reached enormous levels. It’s estimated that the federal government will have spent approximately $1.22 trillion on these debts in 2025, or $100 billion a month. This raises doubts about the long-term sustainability of the American financial system.

In this context, China has accelerated its financial diversification. It has progressively increased its gold reserves, considered a commodity less vulnerable to international sanctions, and at the same time has favored bilateral trade agreements in local currencies.

The fact that even Japan, a historic ally of the United States, is increasingly prioritizing national economic interests over the stability of the American financial system is due to serious internal problems: extremely high public debt, stagnant growth, and a weakened currency.

For decades, the US Treasury market has represented the bulk of global finance. This is changing today: while in 2008, foreign investors held 49% of US debt, they now hold 30%.

This decline was described as follows on May 10 in "Il Sole 24 Ore", the newspaper of the Italian employers’ association, Confindustria: "American banks have quintupled the Treasuries on their balance sheets: in 2022—according to data from the New York Fed—they held $106 billion, and now (as of April 22) they hold $518 billion. But their efforts aren’t enough to keep yields low, considering the speed at which US public debt is growing. This is also because in recent weeks, with the major market upheavals triggered by the war in Iran, some of the recent big buyers have become sellers: according to Bloomberg calculations based on Fed data released on Friday, for example, Japan sold Treasuries last week to support the yen. So yields struggle to fall".

To attract new investors, the United States must offer higher yields on its bonds. But higher interest rates also mean higher public debt costs. Consequently, the deficit grows further and the need to issue new debt increases, fueling what’s known as a "debt spiral".

The consequences aren’t limited to finance. Rising Treasury yields impact mortgages and corporate credit, which shift costs onto the working class, student loans, and the cost of living for American workers. At the same time, they reduce the deferred wages provided by public services.

Losing dominance of the global financial and monetary markets and ballooning public debt could trigger the collapse of senile US capitalism, driven by industrial, commercial, and banking decline. It will be forced to use its military might to counter or influence the growth of competing imperialisms. For the US proletariat, already battered by years of economic crisis, a future of further sacrifices lies ahead, including the supreme one of being deployed to war against its class brothers in other uniforms.

The same thing is true across the oceans: gold, bilateral agreements on local currencies, autonomous payment systems, the internationalization of the yuan: all these phenomena do not represent the birth of a stable and more just order, as multipolar propagandists fantasize, but merely the attempt by new capitalist powers to carve out or increase an autonomous space for themselves in the global imperialist struggle.

Here lies the fundamental deception of any nationalist reading of the phenomenon. Neither China nor the BRICS embody a liberation of humanity from the domination of capital. They simply represent other national capitals advancing against the old American hegemonic center.

The historical truth is that global capitalism has entered a phase of increasingly violent fragmentation. The era of triumphant globalization is giving way to a new inter-imperialist competition in which each State seeks to protect its national capital against the others.

The general collapse of capitalism will drag down government debt with it, turning financial assets into worthless paper. And it will present the international working class with the choice: war, through which the victors will wipe out all accounts, then begin a new cycle of accumulation, or communist revolution, which will wipe out not only all credit, but the very regime of Capital.

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