“Any country can borrow money and drive some growth, but that may not always lead to good growth,” Dimon said Wednesday in an interview with Sky News, adding, “I think America should be quite aware that we have got to focus on our fiscal deficit issues a little bit more, and that is important for the world.”

When asked about the potential consequences the U.S. would face if it fails to drastically lower its deficit in the next few years, Dimon stated, “I don’t think it’s a big comeuppance and I don’t think it’s the next couple of years, but I think it is why we have higher inflation.”

Even as the economy continues to be resilient, he said he hopes the U.S. government “really focuses” on reducing the deficit, because “at one point it will cause a problem, and why should you wait?” 

A problem, he said, “will be caused by the market and then you will be forced to deal with it and probably in a far more uncomfortable way than if you dealt with it to start.”

In recent years, the deficit has been soaring amid Trump-era tax cuts and the massive stimulus programs meant to support the American economy during the COVID-19 pandemic. So far in fiscal year 2024, the federal government has spent $855 billion more than the amount it has collected in taxes, according to the U.S. Treasury Department. In fiscal year 2023, the deficit was $1.7 trillion, equivalent to about 6.3% of the country’s gross domestic product. 

“America has spent a lot of money,” Dimon said, adding, “During Covid and after Covid, our deficit is at 6% now. That’s a lot, but obviously that drives growth.” 

Philipp Carlsson-Szlezak, the global chief economist at Boston Consulting Group, told Fortune that a high national deficit, which has increased under President Joe Biden’s administration despite his intentions to reduce it by “hundreds of billions” through the Inflation Reduction Act, is “not desirable,” but that a high deficit doesn’t risk much in terms of catastrophic consequences in the near or long term picture. 

Carlsson-Szlezak, who also co-authored a book on the national debt, told Fortune he thinks it’s more helpful to consider the government’s current spending policies rather than hyperfocus on plans to reduce the deficit. “Currently, we’re incredibly wasteful in our policy overall,” he said. “We’re adding to the national debt to push [economic] growth, and then we’re raising interest rates to ramp down growth. It’s like stepping on the accelerator and the brake at the same time, where monetary policy is the brakes here and fiscal policy is the accelerator.” 

As deficits soar, the U.S. government must issue more Treasury securities, putting upward pressure on yields to attract investors. But higher yields can counteract economic growth as they tend to raise borrowing costs across financial markets.

“Ironically, by spending less in deficit, you’re actually stimulating the economy because interest rates can fall,” Carlsson-Szlezak said.