Ray Dalio, the founder of hedge fund Bridgewater Associates, said he had a discussion with House Budget Chair Jodey Arrington and other House Republicans about the national debt on Tuesday.
“I appreciate our ability to have a frank apolitical discussion about the mechanics behind how countries go broke as it applies to the circumstances at hand,” Dalio said in a statement about the meeting on Tuesday.
Arrington thanked Dalio for meeting with them, adding that Dalio had “sounded the alarm to Members of Congress on the urgent need to address our unsustainable and exponentially growing borrowing and spending.”
Dalio said in his statement that there was a “pretty broad recognition” among attendees that the budget deficit needs to be cut to around 3% of the country’s GDP.
Dalio added that this cut will ensure that debt servicing costs do not “squeeze out the government’s ability to spend.”
“I look forward to staying in touch about these issues and having similar discussions with others so that there are realistic assessments of the issues and what might be done to deal with them,” Dalio said.
Dalio has previously sounded warnings about the economic dangers of soaring debt levels.
Last month, Dalio said in an interview at the World Governments Summit in Dubai that America could suffer the financial equivalent of a “heart attack” if it didn’t reduce its deficit spending.
“Waiting too long is like ignoring plaque buildup until a heart attack occurs,” Dalio said in February.
The federal government collected $4.92 trillion in revenue in the 2024 fiscal year but spent about $6.75 trillion. That created a deficit of $1.83 trillion — a $138 billion increase in debt from the previous fiscal year.
Dalio said in an interview on Bloomberg’s “Odd Lots” podcast, which aired earlier this month that the US could face a debt crisis in the next three years if it didn’t act fast.
“If you don’t do that, then you own it, OK? You have to take responsibility for the consequences,” Dalio told Bloomberg.
“When the economy and this heart attack of sorts comes along, then you’re going to find yourself that the voters are not going to be very happy. So you own it,” he continued.
A representative for Dalio did not respond to a request for comment from Business Insider.
