Trump's debt increased by $1 trillion in five months, reaching $37 trillion. Lee Jae-myung borrows 100 trillion won through AI fund PF
The Trump administration saw a $1 trillion increase in national debt in five months, and the Lee Jae-myung administration, emulating this trend, has launched a national system of borrowing 100 trillion won through project financing (PF) loans, in line with its pledge to achieve "3% annual AI growth."
This confirms the system's collapse in the event of a stock price decline.
The total US federal government debt surpassed $37 trillion in the first half of this year, exceeding initial projections for 2030.
The US Government Accountability Office published a report on its website titled "The Debt Economy Strengthens the High-Price System by Declining Real Wages," stating, "Increased debt is leading to adverse policy consequences, including 'corporate funding pressures,' 'stagnation of worker wages,' and 'high inflation.'"
The AP reported on the 13th that the record $37 trillion debt update highlights the growing debt on the U.S. balance sheet and the increasing cost pressures on taxpayers. The AP reported that the national debt has surpassed $37 trillion faster than pre-pandemic projections and shattered the Congressional Budget Office's January 2020 projection of a total federal debt of $37 trillion beyond fiscal year 2030.
The debt surge comes despite a 273% year-over-year surge in July tariff revenues ($21 billion) under the Trump administration, which resulted in a 20% increase in the U.S. fiscal deficit in July compared to the previous fiscal year.
A Treasury official, speaking on condition of anonymity to discuss the deficit increase, said, "The overall increase in spending is due in part to increased interest payments on the public debt, increased cost-of-living payments for Social Security benefits, and other expenses," adding that the debt burden is already high. It appears to be caught in a vicious cycle of 'increase'.
The Lee Jae-myung administration's '100 trillion won AI fund growth' was confirmed by the State Affairs Planning Committee to achieve 3% economic growth by 'ensuring public access to infrastructure investment in AI data centers, energy highways, power generation, and water supply through project financing (PF), a speculative development method that involves 'unsecured borrowing' from construction companies without capital from the '100 trillion won National Growth Fund' on privately owned real estate.
President Lee will hold a national briefing session at the Blue House State Guest House on the 'National Growth Fund'-led economic growth plan and finalize 123 national tasks, which will be announced on the 13th.
The National Growth Fund, spearheaded by the State Affairs Planning Committee, is a planned economic growth model that designates cutting-edge strategic industries such as AI, semiconductors, secondary batteries, displays, biotechnology, future cars, robotics, and the defense industry as 'national strategic technologies' and encourages economic growth in related companies.
his model offers companies low-interest loans comparable to government bonds. It appears that project financing (PF) was applied to the entire KRW 100 trillion to maintain the loan and completely exclude safety politics regarding insolvency.
The debt capital loan was intended for "AI data centers, energy highways, power generation, and water supply," which was then disguised as "infrastructure investment." This infrastructure investment was packaged as a "National Growth Fund." To ensure economic relevance, President Lee's campaign promise of "building a basic AI society" was incorporated, forcing citizens to become suppliers by "expanding the AI market."
President Lee's "basic AI society" campaign promise focuses on "establishing a system to enforce citizens' access to AI," with "expanding the AI market" at its core. As a means of market expansion, the administration is expected to reorganize to "innovate public services through AI" through "expanding AI education to the public" and attempting to mandate the "use of AI to prevent future disasters such as floods and wildfires," which have yet to materialize. This reorganization is expected to be announced as a specific strategy in this government agenda announcement.
Lee Jae-myung's government policies are: He has labeled his policy "real growth" with the goals of becoming one of the top three AI powers, achieving a 3% potential growth rate, and becoming one of the top five global powers. To achieve this, he will unveil 123 national tasks today as "expansion of secondary policies."
The AP reported, "While Trump talks about how raising import taxes will make America richer, federal spending continues to outpace the government's tariff revenues." He added, "Companies need to deplete their pre-tariff inventories to import more goods and generate more tax revenue to turn the fiscal situation around. This will reduce the tax deficit first, without meaningfully reducing the deficit as promised."
The US debt-driven economy means that if tariffs fail to deliver on Trump's pledge to improve the government's balance sheet, the American public could face fewer job options, more inflationary pressures, and higher interest rates on mortgages, auto loans, and credit cards.
The US fiscal deficit is a direct consequence of the US government raising taxes. The annual gap between the amount spent and the amount spent affects the overall national debt over time.
After the Trump administration signed the hard-line Republican tax cuts and spending bill earlier this year, more government spending was authorized, which, according to the Congressional Budget Office, "will add $4.1 trillion to the national debt over the next decade."
Michael Peterson, president and CEO of the Peter G. Peterson Foundation, which the Lee Jae-myung administration relies on, said in a statement that day, "Government borrowing puts upward pressure on interest rates, increasing costs for everyone and reducing private sector investment." "Within the federal budget, debt crowds out important priorities and creates a pernicious cycle of more borrowing, more interest costs, and more borrowing."
Wendy Edelberg, a senior fellow in economics at the Brookings Institution, said, "Congress plays a critical role in implementing spending and revenue policies." Regarding the Republican tax cuts, she said, "We will borrow a lot of money through 2026, and This means that we will be borrowing a lot of money through 2027. And it will continue to do so,” he told the AP.
Regarding the expansion of the national debt, the Government Accountability Office released a report stating, “The impact of rising government debt on Americans includes higher borrowing costs for things like mortgages and autos, lower wages for businesses with less money to invest, and higher prices for goods and services.”
The report, titled “How Can Federal Debt Affect You?” states, “Federal debt is growing faster than the economy, and this is unsustainable in the long run,” and “Americans may find that the growing federal debt is harming their personal finances.” The report summarizes the “personal harm” as “higher borrowing costs (auto loans), stagnant wages, and more expensive goods and services.”
The Peterson Institute for Economic Research, in its analysis of the $1 trillion debt expansion process, increasingly points out how milestones are “building up at a rapid pace.”
The United States will reach $34 trillion in January 2024. By July 2024, the debt would reach $35 trillion, and by November 2024, it would reach $36 trillion.
Peterson, president of the Peterson Institute for Economic Research, told the AP, "We're now adding $1 trillion to the national debt every five months. That's more than double the average pace over the past 25 years."
The Lee Jae-myung administration has received support from the Peterson Institute for Economic Research in trade negotiations with the Trump administration, has had Peterson visit Korea several times, and has appointed Yeo Han-koo, a researcher at the Peterson Institute, as head of the trade bureau.
The Lee Jae-myung administration is approaching the $350 billion "investment in the United States" with the Trump administration by expanding "unsecured borrowing" with loans guaranteed by government banks.
The AP reported, "The U.S. Joint Economic Committee estimates that at the current average daily growth rate, the debt will increase by $1 trillion in approximately 173 days."
The Lee Jae-myung administration's State Affairs Planning Committee announced today, "We will expand the arts and culture industry market to 300 trillion won and cultural industry exports to 50 trillion won, creating 'K-culture.'" To achieve this, the government plans to invest 10 trillion won in policy financing, tax incentives, and expand performance-type arenas. This initiative, along with a 10 trillion won budget to "create a 300 trillion won market," transformed "national growth" into a "national contribution project to create a 300 trillion won market." The 10 trillion won in government funding was lent to the public, with the principal and interest on government bonds becoming a burden on the public.
Regarding the defense industry, the State Affairs Committee also confirmed that the plan, which included investments in the National Growth Fund and 1.5 trillion won in government investment, would be a "package export" approach, "a method of raising funds by allocating public debt to boost stock prices," and that a "stock price surge would create an economic system that would support stock prices." A decline in stock prices would pose a risk of system collapse.