The crisis of federal indebtedness threatens to escalate as the last holdout among the three debt rating agencies is sounding a warning on America’s fiscal outlook. Moody’s cautions that American “fiscal strength” has “deteriorated further” since November 2023. That’s when the firm last assigned America its top AAA credit rating. America’s fiscal health, per Moody’s, “is on course for a continued multiyear decline,” the Financial Times reports today.

The warning on the strength of America’s credit is a reminder that today’s Himalayas of debt is a symptom of the fiat money era. The debt crisis is intertwined with, and inseparable from, the monetary crisis that just saw a spiral of inflation unleashed during the Biden administration. Under the gold exchange standard, which America abandoned in 1971, the fiscal and monetary discipline required by currency convertibility would have prevented such a runup in debt.