Impact of $40T in U.S. Debt, Tips to Avoid Scammers, Get AI Workplace Training

Hey everybody, it's Gene Marks, and welcome back to another episode of the Paychex Thrive Week in Review. This is where we take a few items from the news that impacts your small business and mine, and we talk about it just a little bit.

Now, just before we get started, to remind you, it is mid-August, as you know, and the college crowd that makes up part of your summertime workforce is headed back to campus, leaving you with shifts to fill and more hiring to do, unfortunately. This is a predictable challenge, and one Paychex is prepared to help you resolve. The Summer Planning Guide for small business lays out steps to tackle seasonal staffing, onboarding, and mid-year compliance while getting a closer look at the HR tools already at your disposal that help manage the complexity.

Check out go.paychex.com/summer for more details. Just because the calendar is about to flip doesn't mean you have to lose any time in running your business.

Alright, everybody, so the first bit of news comes from the Wall Street Journal, has to do with U.S. debt. Our U.S. gross national debt has now surpassed $40 trillion … trillion dollars, up roughly $17 trillion dollars since 2019. The increase reflects years of federal deficits caused by tax cuts, wars, recession, relief, pandemic spending, and the growing cost of Social Security, Medicare, and other programs.

Debt held by the public now exceeds $32 trillion, while annual deficits remain unusually high at roughly 6% of GDP. The bigger concern isn't the $40 trillion milestone itself, but the direction. Debt held by the public is around 100% of GDP, and it is projected to reach about 120% within a decade without policy changes. Rising interest rates make the problem more expensive because federal interest payments consume an increasing share of the budget.

For consumers and businesses, persistent borrowing could contribute to higher treasury yields, mortgage rates, and business borrowing costs while eventually forcing difficult choices involving taxes and government spending.

So, how does this affect your business? What do you care? It's $40 trillion. When it was $20 trillion, that number was, who knew what, right? Now, you're $40 trillion, you know, how does this really impact you? Well, here's how it impacts you, okay? Interest is taking up more and more of the federal budget. We can see right now with the amount of interest payments that are being made that level is rising to a significant amount.

Now, the government only has three ways to fund its programs. One, it can raise revenues through taxes. That's certainly possible, but we just had a tax cut this past year. Number two is we can cut expenses. So, that's, you know, in this political environment, who's gonna really go for that? And number three is they can simply print more money in order to continue to pay their bills.

Now, to to his defense, Treasury Secretary Bessent says that the U.S. can grow out of this deficit situation. That really remains to be seen, and that's something that is just, who knows. But you're either gonna cut, you know, increase revenues through taxes, cut expenses, or you're just gonna keep printing more money.

Obviously, in this political environment, the easiest solution, which is what's been done over the past 20 years, is to just print more money. Well, as more money comes into circulation, it puts more pressure on inflation because the greater the supply of something, the less value that it has.

So, inflation continues to stick around, which is why we've been seeing inflation at relatively elevated levels over the past couple of years. The only way to fight inflation is through higher interest rates to try and bring back some of that, you know, loans and financing and money that's in circulation that businesses are using.

So, unless the government cuts expenses, not likely, or significantly raise taxes, not really likely either, or we somehow grow out of this deficit situation, we're gonna be seeing the government just print more money. And when it prints more money, that is going to be putting more of an impact on inflation and interest, which gets back to you and me running businesses.

Those days of 0% interest rates and 1% inflation, I think they are long gone. Over the next few years, for at least the foreseeable future, I think you can expect to see interest rates and inflation anywhere both in that 3 to 7% range. It's the only way that the government has to try and keep some type of control over its spending. If it's going to be printing that much more money, it's just going to be a consequence of that.

So, is that a terrible thing? Is that a disastrous thing? No, it's actually really not. But it's something that you and I have to know as business owners to build into our plans, into our budgets, into our forecasts that over the next few years we can really – and this is just my prediction, but I think it's right – that we're going to be dealing with higher interest and inflation. It's just going to be part of the norm now, not something that just gets reported as an anomaly. Higher interest rates and inflation are going to continue.

That's how this $40 trillion debt is impacting you and me as business owners.

The next story has to do with fraud. This was reported on, it was an AOL article from Scripps News. A small business owner named Kenny Sumner lost $15,000 after receiving a sophisticated phone call that appeared to come from his bank's fraud department. The caller claimed someone was attempting an unauthorized wire transfer and sent Sumner a six-digit verification code.

Believing he was protecting his account, Sumner read the code back. The scammers instead used it to gain access and remove $15,000, money Sumner had intended to use to expand his hearing, er, heating, and cooling business.

Some bank impersonation scams like this are becoming increasingly difficult to detect because criminals can spoof legitimate telephone numbers and use AI and stolen personal information to make calls more convincing. The Federal Trade Commission warns that some of the costliest impersonation scams begin with fake bank security.

The practical lesson: never provide a verification code to someone who calls you. Hang up and contact your bank independently using its official phone number.

So true. I was gonna give the same advice myself, but nowadays, particularly this area of deep fakes and AI, we have to be really, really careful when it comes to scammers literally calling us and posing as or impersonating officials from banks that they're actually just fraudsters. So, the best way to protect against that is that if somebody does call you from a bank and they say there's fraud detected on your account, that's one thing. If they start asking for personal information or to verify a code, for example, that's an entirely another thing.

And what you need to do is you need to say, “That is fine. What is the name of your (bank), what is your customer service number for me to call back? Validate that number online, make sure that it is the right number, and then you call back the bank that way, so you're in control. Don't give up any private or business information to anybody who just calls you, no matter how, you know, convincing or genuine that might sound. It is not a good idea.

All right. In this week's AI news, we're gonna turn to an article in PC magazine. It's about Claude. Anthropic has significantly expanded Claude’s integration with Gmail, Google Calendar, and Google Drive – moving Claude closer to functioning as a full workplace assistant rather than simply an information chatbot.

Claude can now search and read Gmail, draft messages, and importantly, send, reply to and forward emails directly. Users normally must approve each outgoing message, although team and enterprise administrators can permit certain actions without individual approval. Claude can also create, update, and delete calendar events, find mutual availability, and manage attendees. In Google Drive, Claude can search and retrieve files as well as share, move, and trash them, as it can read docs, sheets, slides, PDFs, images, and Microsoft Office files, as well.

The upgrade is significant because Claude can increasingly take actions inside business applications instead of merely recommending what users should do, intensifying competition among Anthropic, Google, and Microsoft to provide the primary AI assistant for office work.

So, what does that mean? Well, let me tell you what that means when it comes to AI this year. Get Claude, get Gemini, get ChatGPT, get Grok, get Google Copilot. Integrate them with all of your business data, for sure. That way you can use those AI assistants to query and analyze and get information about your business data, as well as corresponding data on the internet.

Now, as these integrations are getting more and more complex and more and more substantive, lean into them and get some training. For example, if you are a Google Workspace business and you're using Google Workspace for all of your office work, I personally would either be using Gemini or Claude. I would be connecting Gemini or Claude to all of my systems – Gmail, Google Calendar, Google Drive, whatever – and as a team, not for individuals, but I would be getting … hiring a consultant, looking at the processes that we have, figuring out how Google Gemini or Claude or whatever your AI assistant can help increase productivity within those processes. And then train and come up with a plan for your entire team to do things in a coordinated way.

I'm already seeing too many clients take the step of connecting their AI assistant to their data and then just leaving it up to their employees to play around. So, some do a better job, others do a different job, people are using it in different ways. No, no, no. This is powerful, powerful stuff, which means that once you get your AI assistant connected to your data, you should be getting training for your employees and have a plan for rolling it out, so that it is providing the maximum amount of productivity for your business, and you can leverage those AI tools in exactly the right way.

So, this deeper integration, Claude and Google, it's the tip of the iceberg. All these platforms are going to be doing that. A lot of them are already well down the road of doing that. Your goal is not just to use it, but to have your teams use it in a coordinated, well-done, productive fashion.

My name is Gene Marks, and you have been watching or listening to this week's episode of the Paychex Thrive Week in Review. I hope you've enjoyed it.

Remember, if you are looking for help and you want you are interested in how Paychex can provide help for your HR and payroll, particularly as your summer workers are going back to school, download the Summer Planning Guide for small business. Go to paychex.com for go.paychex.com/summer. The link will be in the details and notes to this show.

If you need any help or advice in running your business, sign up for our Paychex Thrive newsletter. Go to paychex.com/thrive. And by all means, please follow us and like us both on YouTube and on your favorite podcasting platforms.

Thank you so much for watching or listening. I'll be back with you next week to talk about more issues that are impacting your business in the news. My name is Gene Marks. We'll see you then.

My name is Gene Marks, and you've been watching or listening to the Paychex Thrive Week in Review podcast. A few things to take away. First of all, if you are in need of HR or payroll help in your business, consider Paychex. Go to paychex.com/meetpaychex. That's P-A-Y-C-H-E-X.com forward slash M-E-E-T-P-A-Y-C-H-E-X. Please follow this podcast on your podcast platform or on YouTube if you are enjoying the content so you stay up to date on our latest episodes.

And if you need help or advice or tips in running your business, get our Paychex Thrive newsletter. Go to paychex.com/thrive and sign up for it there.

Hope you found this information helpful. I'll be back with you next week with more news that impacts your small business and mine. My name is Gene Marks. Thanks so much for watching or listening. Take care.

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