Trump and the risk of a US debt default

The former US president, if he is re-elected in November, could default on government debt, as he proudly has with some of his businesses. It’s unlikely, but not impossible

As president, Trump could order the Secretary of the Treasury to abstain from paying interest or repaying the principal on the federal debt. Missing a payment would put the United States in default.

Donald Trump knows a thing or two about defaulting on debt. His businesses have filed for reorganization under Chapter 11 of the US Bankruptcy Code at least four times to overcome excessive indebtedness — first with Trump Taj Mahal in 1991, then Trump Plaza Hotel in 1992, Trump Hotels and Casino Resorts 12 years later, and Trump Entertainment Resorts in 2009.

Moreover, Trump openly boasts about this strategy. “I have used the laws of this country just like the greatest people that you read about every day in business have used the laws of this country, the chapter laws, to do a great job for my company, for myself, for my employees, for my family,” he said in 2015.