de facto bankrupt?

Hi Global Recap readers,

The US just blew past $37 trillion in debt, and barely anyone blinked. And not many are aware of this ever-increasing ticking time bomb.

• Modern monetary theorists say not to worry. As long as the dollar remains the world’s reserve currency, the US can print and borrow with impunity.

• Critics disagree. They warn this path leads to Japan-style stagnation, where central banks hold the bag and real growth flatlines for decades.

But both agree on one question: what happens when the world stops trusting the dollar?

Well, we can only guess, but today’s passing of Trump’s One Big Beautiful Bill could be the turning point. It’ll either pull the US out of its debt spiral through growth or slowly drag it in deeper.

Or, according to Musk, America “will become de facto bankrupt” because of its ballooning expenditure. 👇️ 

🌐 WORLD
Fast Scroll News

🇷🇺 Russia Recognizes Taliban. Russia just became the first country to officially recognize the Taliban’s rule in Afghanistan since their 2021 takeover.

• On July 4, Moscow accepted credentials from Taliban envoy Gul Hassan Hassan, after removing the group from its terrorist list in April.

• Putin approved the move following advice from Foreign Minister Sergey Lavrov, with the Kremlin calling it a step toward “full-fledged relations.”

• The Taliban hailed it as “a good example for other countries” even as they continue to ban girls from school and women from public life (including singing).

🇵🇪 Peruvian President Doubles Pay. Peru’s President Dina Boluarte quietly raised her salary from $4,400 to $10,000 a month, despite approval ratings hovering at 2% and poverty stuck near 30%.

• Her finance minister confirmed the raise is already approved and in effect, calling it a “correction” compared to other Latin American leaders.

• One pensioner mocked her, saying, “It’s a joke.”

• Is this her last "hoorah" before she leaves office in 2026?

🇺🇸 Trump Calls Putin. Hours after the Pentagon froze missile shipments to Ukraine, Trump jumped on a call with Putin.

• The pause is officially about the US replenishing its own stockpiles.

• This comes just weeks after promising more Patriots at the NATO summit.

• Trump says he told Putin to end the war, calling the civilian death toll “levels people haven’t seen before,” but also admits that he "didn't make any progress."

🇦🇹 Austria Deports Syrian Criminal. Austria just became the first EU country to send someone back to Syria since the Syrian civil war began 15 years ago.

• A 32-year-old man, convicted in 2018 and stripped of refugee status, was flown to Damascus via Istanbul on Thursday.

• Interior Minister Gerhard Karner called it a “signal” of Austria’s tough asylum policy and said more deportations are coming.

• Rights groups are warning that this move could trigger a broader EU shift, even as questions remain about Syria’s safety under its new Islamist government.

• Supporters are baffled by the outrage from rights groups, since this is a convicted man whose refugee privileges were stripped because of it.

🇩🇰 Denmark Targets Hungary Vote. Denmark just called for full Article 7 action against Hungary, which could strip Budapest of its EU voting rights.

• Danish European Affairs Minister Marie Bjerre said Hungary’s legal violations and blockade of Ukraine’s membership bid “can’t go on,” especially with Denmark now leading the EU Council.

• That’s where it gets tricky. France and Germany still haven’t backed it.

• Denmark also warned it’s not ready to split Ukraine and Moldova’s accession tracks, despite Brussels floating that idea.

🇺🇸 UNITED STATES
Trump’s “Beautiful”
Tax Bill: Passed

House Republicans pushed through Trump’s $4.5 trillion One Big Beautiful Bill just before the July 4 deadline, with the slimmest of margins and buckets of political fallout.

A Win, Barely

In the end, it passed. Of course, it wasn't without drama.

• Former Republican representative Ron Paul called the bill "The Big Beautiful Bankruptcy Bill."

• Elon Musk called on anyone backing this "biggest debt increase in history" to "hang their heads in shame."

• However, in the end, the House greenlit the bill 218–214, with every Democrat and two Republicans voting against it.

• Trump called it “a great bill for the country” and plans to sign it July 4 Independence Day weekend.

• GOP leaders worked overnight to wrangle votes, including personal calls from Trump to skeptics.

• House Speaker Mike Johnson celebrated by quoting Trump and playing the infamous YMCA song after the vote.

What’s in the Bill

The bill combines GOP tax priorities and cuts into one nearly 900-page package.

• It revives and extends $4.5 trillion in tax cuts Trump implemented during his first term, including new deductions for tips and overtime, plus a $6,000 break for older adults.

• It also adds $350 billion for national security and immigration enforcement, including a “Golden Dome” defense initiative.

• To pay for this, it slashes $1.2 trillion from Medicaid and food stamps, expanding work requirements even for older adults and some parents.

• It also rolls back Obama’s Medicaid expansion and Biden’s green energy tax credits. Supporters of the bill say that these moves are meant to shrink the welfare state and crack down on "waste, fraud, and abuse" in federal programs.

Reactions

This bill is being pitched as pro-growth. But not everyone’s buying it.

Democrats

• Minority Leader Hakeem Jeffries spoke for 8 hours and 44 minutes to block the vote, slamming the bill as a "big ugly bill" and calling the House floor a "crime scene."

• He read letters from Medicaid recipients and said the bill would “rip food from the mouths of hungry children.”

• Democrats remained unanimously opposed, calling it “trickle-down cruelty.”

Internal GOP Tensions

• Two GOP defections: Rep. Thomas Massie (Kentucky) and Rep. Brian Fitzpatrick (Pennsylvania).

  • Rep. Brian Fitzpatrick cited Medicaid concerns.

  • Rep. Thomas Massie said it “wasn’t beautiful enough for me to vote for it.”

• Trump’s team allegedly offered carrots or warned of consequences. if lawmakers didn’t fall in line.

Policy and Political Fallout

Apart from the fireworks, this is a gut punch to the legacy of the Obama and Biden administrations.

• Rolls back Medicaid expansion from the ACA and major parts of Biden’s climate law.

• Congressional Budget Office: The Congressional Budget Office says 11.8 million would lose health coverage, and $3.3 trillion will be added to the deficit.

• Tax Policy Center: Top earners get nearly $11K in breaks, while the poorest see just $150.

Closing Thoughts

Take a look at this post by Rep. Massie. It captures what the critics of the bill are saying about the issues they see down the road.

• The US debt recently shot past $37 trillion.

• If the bill's reason for raising the debt ceiling by $5 trillion is to make room for printing more money down the line, that probably means higher inflation.

• Therefore, Massie argues that the bill’s tax and spending cuts don’t really matter because printing more money will weaken the dollar’s value.

• Inflation and borrowing push interest rates higher to keep inflation in check. That hits businesses, consumers, and homeowners hard, leading to economic headaches.

If this is true, what’s the point of saving a few hundred dollars in tax cuts when inflation will just destroy the purchasing power of consumers?

⏱️ That said, the bill's already passed, so it's done. Sure, the critics’ predictions could turn out to be off. At this point, all we can do is hope it delivers on its promises—more growth and a better standard of living.