This is only true if you take absolute numbers.

Debt rates in comparison to the countries' GDP (in real terms, not nominal terms) are stagnating or sinking in most cases. Most of the recent increase of spending/borrowing can be explained by COVID, and since then the debt rates as percentage of GDP have lowered.

Some examples (2020/2021 to 2024):

- Euro Area: 97% to 87%
- Japan: 225% to 216%
- US: 130% to 125%
- Brazil: 85% to 76%
- India: 58% to 56%

The most significant outlier is China where public debt grew, but on a very low level (20% to 26%).

(Sources: Statista and Ceicdata.)

I don't say that the current debt level is healthy. I'd always opt for a small but gradual debt decrease policy in "good times". But Japan shows you can live highly indebted for decades. So I don't see any collapse in the near future. It's something Bitcoiners seem to like to overdramatize to promote BTC to "fix it" (even Satoshi in some ways did that in his famous on-chain message). But I think Bitcoin doesn't need a financial collapse to thrive, it can thrive even if fiat is doing well for decades more.