By virtue of the global role of the U.S. dollar and the U.S. leadership of the global financial system, the U.S. government has been able to borrow large amounts, on generous terms. The United States has therefore avoided politically fraught decisions related to taxation and spending, while exercising political leverage globally. Now, U.S. government actions generate uncertainty and instability; they undermine the rules-based liberal international order from which the U.S. benefitted greatly. Eroding rule of law, accountability and transparency raise the specter of political risk in U.S. sovereign bond markets. As a result, servicing the large U.S. federal government debt and maintaining dollar dominance will become more difficult.