Comment by epistasis

It is not "100%" necessary. Worst case, we just print dollars to pay off the debt. The US Government is not a business in the sense dollars, it's a business in the sense of issuing equity out in the world. And just as a company can print more equity at any time, the US government prints equity, equivalently, by either printing dollars or by issuing Treasury Bills (debt), which are merely more complicated dollars. T-bills are more complicated dollars in two ways 1) they throw off a small amount of interest making them more attractive than regular dollars, 2) their value can be retroactively changed whenever the US changes interest rates. That second point, they dynamic revaluation of previously issued T-bills by interest rate changes, is what gives a lot more monetary control than if we just printed dollars.

But if we are in a situation where there's been a bond investor revolt, and there's nothing else to be done, we just give dollars to everyone as T-bills mature rather than issuing more debt, and we retract from the world stage, and become like other countries in the world.

We are a loooooong ways away from that position, but this presidential administration is behaving so erratically that the US dollar is closer to losing its privileged status than I ever thought possible. It's such irrational, damaging, and erratic behavior going on right now that everything could topple if it continues for much longer.