Jim, I'm curious if you have an opinion as to what might happen to the financial system if it's even broached at an official level that foreign debt holders would be forced to swap for perpetual bonds?
And closer to home: in such a situation would holding T-bills be relatively safer for those of us now invested in defensive positions than holding ETFs or mutual funds that invest in short-term U.S. backed government securities?

I don't know what would happen, but it would be chaotic.
Certainly the US can default on its debt if it wants to, just as anybody else can. It's a risk you take when you lend money to anybody. The 1934 US bond default was massive, but the world moved on. The default April through May 1979 ended. Presumably a problem for those expecting their money to be repaid on time, but again, the world moved on.

I presume the main effect would be erosion of trust in the currency, inside the US and out. The US would move a lot further away from being the world's primary reserve and trade currency. This would mean giving up the privileges that come with that, such as the formidable ability to effect huge penalties on individuals and organizations anywhere in the world simply by denying them access to the US payments system. This is such a predictable consequence that methods to prevent this outcome are included in most drafts of the so-called Mar-a-Lago Accords. Specifically, to coerce non-US governments to continue relying on the primacy of the US dollar, for example by denying the explicit or implicit defence umbrella to those that don't (abrogating treaties in the process, but that too is something that happens in the world). Or of course unbearable tariffs.

I don't see any specific risks to US based holders of T-bills, other than the more general ones that it is always possible that the economy might do very badly at some point in the future, to the extent that devaluation becomes a risk and *all* US-dollar-denominated guarantees become slippery in terms of purchasing power. And the risk of the occasional hiccup when the debt ceiling is hit and congress won't let them be redeemed on time, but people are used to that.

Jim