- Ray Dalio said solving America's debt problem will require a bipartisan solution.
- But Dalio said Republicans and Democrats can't do it "because politics have become so absolutist."
- "To me, that's a tragedy," he added.
Ray Dalio, the founder and former CEO of hedge fund Bridgewater Associates, said on Monday that Republicans and Democrats don't have the political will to reduce the country's national debt.
There is no way that the deficit/debt bomb problem can be sustainably dealt with unless there is a mix of tax revenue increases and spending decreases that are determined in a bipartisan way," Dalio wrote in an X post on June 30.
Dalio said in his post that both Republicans and Democrats know they have to cut the deficit by raising taxes and cutting spending. This "would lead to a supply/demand balance improvement for US debt which in turn would lower interest rates," he added.
Dalio said lower interest rates would "reduce the budget deficit" and "help the markets and the economy."
"But because politics have become so absolutist, they feel they can't go down this obviously best path because both their constituents and their parties will throw them out of office if they explored this more balanced approach," Dalio wrote on X.
"To me, that's a tragedy," he added.
