The funny-stupid bit is that Republicans discovered that this is a viable strategy and _therefore_ raise the debt as much as possible _so that_ when democrats try to do anything of long term value, they can scream about "the debt is too high!"
And don't forget the flipside. When a Democrat is in the office and a Republican raises red flags about the national debt, similar "no big deal" arguments are made ("you don't get it, a nation isn't running like a household, debt doesn't mean the same thing" / "oh yeah, well look how fast the national debt rose under <last Republican president>; checkmate!")
Going back over every president over my lifetime the deficit has trended down during Democrat presidents and up during Republican ones, so I’m not sure this is true!
There is no flipside and attitudes toward debt are not symmetrical. And outcomes are not symmetrical either - most of the debt is caused by republicans.
Only true in the 20th century. Since George W. Bush it's been Republicans by far. These are objective numbers. I'm not sure how people can argue with them.
Clinton's balanced budget and surplus is a bit of an outlier, and my understanding is that it had two causes. One was the line item veto, eventually overturned. The other was a booming economy and no major wars (peace dividend). We could have the latter now, of course, if we didn't go get into wars that don't concern us.
Bush is when I'd say the Republican Party gave up any actual belief in fiscal restraint. They still use it rhetorically because it sells with their base but they do the opposite when in power, which means they clearly don't really believe in it.
Trump is the biggest spender, and I don't think you can blame it all on COVID because he's still doing it. This shouldn't surprise anyone. As a shady hustler "businessman" he was known as the "king of debt" and borrowed and walked away so many times many banks would no longer deal with him under any circumstances. He's really one of the legendary practitioners of predatory borrowing. Along with "any publicity is good publicity as long as they spell your name right," his other motto might be "if you owe the bank a million dollars you have a problem; if you owe the bank a billion dollars the bank has a problem."
Clinton didn't have the line item veto long enough to make the difference. What he had was a booming economy and a republican Congress and the ability to get along with them.
Yes, the minority party complains about spending, the majority party spends. "D" and "R" doesn't enter into it.
You'll note even the minority party rarely does much about it, like, proposing concrete spending cuts or anything. Not quite never, but rarely. Or pushing actual cuts through a branch they control even if it will be shot down by another. Proposing a concrete cut would open them up to criticism. They just complain vaguely about the spending.
Ah, I remember those days when Clinton was in office and no more deficit. He also did a DOGE type thing to modernize and make the government more efficient (though in a measured way, not putting children in control). Those were the days.
Party with power spends money. Party not in power complains too much money is being spent. Broken system. Those high interest rates ought to teach them pretty soon.
A lot of deficit spending accelerated with Reagan, when mortgage interest rates were 18%. Yeah, high interest rates will learn ‘em real good this time.
Well, Clinton took over when the Soviet Union had just dissolved. Of all US Presidents, he had the least to worry about on the defense front. Reagan's spending was a reason why the Soviet Union collapsed when it did. So it's not that black-and-white.
Way too reductive. Look at the deficit growth numbers under democrats vs republicans. This comment is just another variant of lazy "both-siderism" that I have really come to loath
"I'm not bald, there's nothing special about 300 hairs, which I currently have, compared to 300,000, which I used to have making me suddenly bald"
Just because there's no magical boundary number doesn't mean a metric can't become increasingly more shitty, and suddenly turn into a bad outcome. Not every response is linear.
The best lies contain truth in them. Yes, there's nothing magical about $40 trillion. It's true, nominally. But if the conveniently-round number, in dollars (an arbitrary unit) and base-10 (an arbitrary base) prompts some people to poke their heads up and start asking questions, that's a good thing. Mind you $10 trillion might have been a better time, but, $40 trillion is a better time than $100 trillion.
I recall back in 2016 when the debt was $19 trillion dollars.
Here we are 10 years later at double that.
“we must not let our rulers load us with perpetual debt… place economy among the first and most important republican virtues”
-Thomas Jefferson
Yes demographic shift and bubble economics, this much is true. But Japan is hampered by constitutional restraint of their armed forces, the United States economy (infamously) enjoys much broader support from intelligence and military. Japan also historically rejects mass immigration, which the United States has adopted as a means to replenish low skill workforce and 2nd generation child->skilled worker pipeline. If political power can successfully be wrested from the boomers, the USA can abandon their entitlements and rebound quickly. If boomers hang on to political power: a period of sticky inflation and slow growth.
Boomers? Sigh. Please articulate better. You can't refer to an entire generation as 'at fault'.
It's dumb, greedy, selfish politicians, and they come from all generations, including yours and mine, and in the future they'll come from generations not yet old enough to run.
Boomers is a stupid term used by people who only understand easy answers.
Democrats tend to get railed for it even though Republican presidents raise the debt more. It gives the impression that only Democrats are trying to fix it and Republicans give it more lip service but often make it worse.
It is "the party the President is in", typically. Today that happens to be "R" but the President has taken the brunt of the blame for good or bad economies for a long time now, regardless of how correct that blame assignment may be.
I expect various emergency measures to try to keep things afloat until the election. By "afloat" I mean, specifically keep the numbers everyone is looking at looking "good", mostly, the stock market indices, the various US Treasury rates, and the US Dollar Index. After that, who knows. And the fact that I expect them to try doesn't guarantee they will succeed. There's plenty of motivation for forces who want them to fail at that task to take measures to strike while the iron is hot.
Ah, I used to say that US debt in dollars is about the same as the amount of cells we have in our bodies. But "they" really took a big leap these past years!
US government bond yields are regarded as the rate of return on a risk-free asset.
So, for someone to decide to lend you money or invest in your business, you need to offer them a higher rate of return. This extra return is the risk premium. So when interest rates are close to 0 per cent, mortgages are cheap and everyone is prepared to risk their money on a slide deck promising significant losses over the next three years. Because cash yields next to nothing, investors race to generate returns elsewhere, which artificially depresses the risk premium.
If US bonds are at 5 per cent, your banker will add their margin on top and your bank loan will be at least 7 per cent or higher if they fear a rise in interest rates and inflation. Investors will be much more discerning and demand higher risk premiums to move away from risk-free yields. As there are far fewer sectors capable of offering such returns, investment will concentrate on a very small number of sectors and companies (does AI ring a bell?).
It is therefore the bond yield that affects us directly, rather than the volume of debt alone. The volume of debt does have an effect, however, as the bulk of the interest is paid by issuing new bonds. If the government repays with cheaper bonds, it isn’t too serious; but if rates rise, the impact on budget deficits is exponential.
The thing is, the more debt and interest there is to pay, the more bonds need to be sold. To absorb this huge supply, the market demands higher yields to attract buyers, which in turn drives up borrowing costs for everyone.
The other half of the equation is what the government is spending the borrowed money on. The effect on the real economy is significant and pertinent to market performance of sectors.
The Keynesian debt theory, the government should run up debt and support the economy during recessions, and then repay that debt quickly during periods of growth. This is not what is happening.
Repaying the interest on debt held by a Norwegian pension fund has only a very minor impact on the US real economy.
International buyers will cool on the idea of holding US debt.
US policy will artificially lower the interest rate to stimulate the economy. Also, the spending of the federal government will continue to increase above the tax receipts.
This will result in inflation. Which is great if you owe money, since you are paying it back with cheaper money.
But, the interest rates being low will make it easier to borrow? The resulting divide by zero in the economy (meaning an exception that there is no solution to) will result in the US government repudiating it's prior debt and making the 'new dollar'.
Anyone can speculate. If we fail to pay interest in a timely manner, then presumably fewer foreign entities will buy our debt, and we will have less money from debt sales to fund what debt funds. Whether that pain is spread equally or not is anyone's guess.
If we fail to pay interest in a timely manner is potentially catastrophic. US Bonds are considered a safe haven because we have never defaulted on our debt
The principal is repaid by issuing new bonds at maturity. This can be sustained for a long time if interest rates are low, but for much less time if rates rise.
The volume of bonds being issued becomes so great that rates have to be raised to ensure they all find buyers.
It is not as though the US Treasury can afford to wait until it finds a buyer at lower yield. It absolutely must sell these bonds to pay off the principal on the old ones.
Scenario 1: It will be nothingburger right until the time it isn't. US can't default on its debt - so massive inflation and money printing until everything is rebalanced.
Scenario 2: AI and robotics deliver growth on par with semiconductors and internet. Couple of decades of the economy growing faster than the debt will put it in manageable ratio.
USA is really rich in resources, extremely well defended by geography, so I guess they will make do even in the worst scenarios.
then that the debt has been accelerating with either party in power - means this is a problem that won't be solved politically by the current actors i.e both parties.
I've often wondered if US Debt has ever actually mattered for the US. They were complaining when Bush took Clinton's surplus and wasted it on wars, and grew the deficit to $10T (some was Great Recession bailout related). The complained about Obama when he added another $10T over his terms. Then a little when Trump did almost $10T in his first term (some of that was COVID related). Then a LOT when Biden did the same thing. And now Trump second term he's "only" added a couple trillion.
Don't get me wrong, these are giant numbers and we shouldn't be spending like this. But We have been spending way more than we bring in since 2003, and it hasn't been an issue.
You’re right, they’re just numbers. Relative to other economies they can tell us the strength of US hegemony but, the numbers are not a reliable indicator of themselves - because the money isn’t “real”.
Interest rates are still within "normal" range, so the market is signalling that's it isn't that big of a deal.
Countries have a debt crisis when their debt is huge and their interest rate is off the wall. Pretty much the market deciding that they are cooked.
Wake me up when GDP is stagnant and interest rates are climbing over 15%. The US is still the global leader on multiple fronts with a well diversified economy.
Your number is too low still. Half of those filers are not contributors, they receive refunds. The figure is more like ~65 million taking on this tax burden, so likely closer to 15k (rounding math)
I read a newspaper article about this. Apparently according to Dutch economists the US only has to raise taxes by a few percent and the deficit is fixed.
I think this is a great solution. Raise some revenue. Tax the rich more. (not being sarcastic, we need more tax money coming in) I didn't say 'eat them', just reach into their pocket and extract more (double? sure...)
At the same time, pull back on the spending. Or maybe even pull back on the growth in spending. No need to go to a full Doge; rather just pull it back a bit.
>"something the average consumer has absolutely no control over and no ability to solve"
Of course they do. Grow a new fucking party and vote for it. Better than one half f the population hating the other half. Just what politicians of either branch enjoy.
I've seen extremely smart/well-educated people (not in politics or any skin in the game) argue the debt isn't really a problem. "It's not like your household debt" and all. This one probably isn't just about education.
That is the Fed educated position. The Keynsian view of economics sees the good economic times as normal and bad economic times as the aberration. Thus, from that view you go into debt to hold the economy over until the good times return.
I've always seen that as an excuse to spend more that you have. Its a trap that is difficult to get out. It is the same as taking more personal debt that you can service. But in the case of the government the bank never says no.
In small amounts, say <3 trillion dollars, the smart people are right.
If the government needs to run a deficit to fight a war, or get the population through a pandemic, it is not a problem.
That's because the US national debt is indeed not like household debt. As a household, I can't choose to print more GlibMonkeyDeathBucks and hand them out to service my debts. I also don't have my own standing army to defend from creditors who might try to seize my hard assets.
Crash the system
-> Blame the others, exploit the crisis, topple the institutions
-> Retvrn to the gilded age.
This is horrific for 98% of the people, but a dream for power-hungry people who detest the idea that powerful people are being kept in check by the rule of law and the interests of the average Joe. Also this is the only path for 'white christian nationalists' to enforce their vision of a submissive, religious, ethnically clean society.
The heavy damage done to the USA by means of self-sabotage is not unintentional. Public discourse/media is over-focused on Trump. Although he is over his ears in corruption scandals, he isn't the genius behind it. The ideologues behind Project 2025 are the real interesting figures, but we barely hear about them. Instead of root case analysis, we have daily drama and performances from publicity actors. The average Joe is distracted with all kinds of nonsense while the Overton window moves.
The real shit will begin when the financial world will factor in the chance of a successful self-coup. Hoping for the best, but it will take more than a decade for a constructive movement in power to limit the damage, and it will take a generation of cultural and institutional reforms to make the state more resistant against anti-democratic coups.
I look forward to hearing how we have to let more children starve so Trump can build more ugly monuments and we can drop more bombs on school girls in foreign lands.
I put together a quick flow chart to determine if we need to worry about the national debt.
Spending must________No bigstop immediately_______deal
The funny-stupid bit is that Republicans discovered that this is a viable strategy and _therefore_ raise the debt as much as possible _so that_ when democrats try to do anything of long term value, they can scream about "the debt is too high!"
Republican fiscal strategy seems like they're going to try and rollover the deficit like a high score in Pac-Man.
And don't forget the flipside. When a Democrat is in the office and a Republican raises red flags about the national debt, similar "no big deal" arguments are made ("you don't get it, a nation isn't running like a household, debt doesn't mean the same thing" / "oh yeah, well look how fast the national debt rose under <last Republican president>; checkmate!")
Going back over every president over my lifetime the deficit has trended down during Democrat presidents and up during Republican ones, so I’m not sure this is true!
Congress passes budgets. Checkmate.
There is no flipside and attitudes toward debt are not symmetrical. And outcomes are not symmetrical either - most of the debt is caused by republicans.
Source?
Only true in the 20th century. Since George W. Bush it's been Republicans by far. These are objective numbers. I'm not sure how people can argue with them.
Clinton's balanced budget and surplus is a bit of an outlier, and my understanding is that it had two causes. One was the line item veto, eventually overturned. The other was a booming economy and no major wars (peace dividend). We could have the latter now, of course, if we didn't go get into wars that don't concern us.
Bush is when I'd say the Republican Party gave up any actual belief in fiscal restraint. They still use it rhetorically because it sells with their base but they do the opposite when in power, which means they clearly don't really believe in it.
Trump is the biggest spender, and I don't think you can blame it all on COVID because he's still doing it. This shouldn't surprise anyone. As a shady hustler "businessman" he was known as the "king of debt" and borrowed and walked away so many times many banks would no longer deal with him under any circumstances. He's really one of the legendary practitioners of predatory borrowing. Along with "any publicity is good publicity as long as they spell your name right," his other motto might be "if you owe the bank a million dollars you have a problem; if you owe the bank a billion dollars the bank has a problem."
Clinton didn't have the line item veto long enough to make the difference. What he had was a booming economy and a republican Congress and the ability to get along with them.
Yes, the minority party complains about spending, the majority party spends. "D" and "R" doesn't enter into it.
You'll note even the minority party rarely does much about it, like, proposing concrete spending cuts or anything. Not quite never, but rarely. Or pushing actual cuts through a branch they control even if it will be shot down by another. Proposing a concrete cut would open them up to criticism. They just complain vaguely about the spending.
Not since Clinton in the 90s. Could use another pull back on military spending like we did then
It will certainly be the "number one" issue, just as soon as democrats take control of the legislative or executive branch of government.
It's very tiring to watch this happen over and over.
Ah, I remember those days when Clinton was in office and no more deficit. He also did a DOGE type thing to modernize and make the government more efficient (though in a measured way, not putting children in control). Those were the days.
Party with power spends money. Party not in power complains too much money is being spent. Broken system. Those high interest rates ought to teach them pretty soon.
A lot of deficit spending accelerated with Reagan, when mortgage interest rates were 18%. Yeah, high interest rates will learn ‘em real good this time.
There's also a revenue side to the deficit.
The deficit has far more closely followed tax cuts than anything else.
Why do people always assume every single issue is symmetrical both party issue regardless of what reality is?
Well.. not quite. Clinton actually did something about the deficit.
Well, Clinton took over when the Soviet Union had just dissolved. Of all US Presidents, he had the least to worry about on the defense front. Reagan's spending was a reason why the Soviet Union collapsed when it did. So it's not that black-and-white.
Could you tell us about any passably-comparable situations, where high interest rates actually taught a national government to grow up and behave?
Way too reductive. Look at the deficit growth numbers under democrats vs republicans. This comment is just another variant of lazy "both-siderism" that I have really come to loath
"There’s nothing magic about the $40 trillion number, and we can grow our way out of that" - Bessent
He also claims the number is temporary because of tariff refunds, and that they will reduce the debt with more tariffs.
We'll grow our way out whenever the mythical trickle down works
"I'm not bald, there's nothing special about 300 hairs, which I currently have, compared to 300,000, which I used to have making me suddenly bald"
Just because there's no magical boundary number doesn't mean a metric can't become increasingly more shitty, and suddenly turn into a bad outcome. Not every response is linear.
The best lies contain truth in them. Yes, there's nothing magical about $40 trillion. It's true, nominally. But if the conveniently-round number, in dollars (an arbitrary unit) and base-10 (an arbitrary base) prompts some people to poke their heads up and start asking questions, that's a good thing. Mind you $10 trillion might have been a better time, but, $40 trillion is a better time than $100 trillion.
Grow our way out of that means hitting the $50 trillion number.
He's right, the number is temporary because of tariff refunds: as the refunds are issued, it will grow.
We will grow to $50T before you know it, and this headline will look silly.
Maybe there is no magic about the absolute number. How about magic of the debt servicing costs that are paid by Joes and Janes
"grow" == "inflate"
I recall back in 2016 when the debt was $19 trillion dollars. Here we are 10 years later at double that. “we must not let our rulers load us with perpetual debt… place economy among the first and most important republican virtues” -Thomas Jefferson
Well this is OK because money is worth half as much now.
Yeah and inflation was transitory, so don't worry ;)
Previous discussions:
https://news.ycombinator.com/item?id=49366743
https://news.ycombinator.com/item?id=49378560
Don't forget that the debt to geo ratio is only 120%. Japan was able to get up to 200% in a low interest the rate environment.
We’re headed toward an economy like Japan’s. It’s not a place we’re going to want to be.
Yes demographic shift and bubble economics, this much is true. But Japan is hampered by constitutional restraint of their armed forces, the United States economy (infamously) enjoys much broader support from intelligence and military. Japan also historically rejects mass immigration, which the United States has adopted as a means to replenish low skill workforce and 2nd generation child->skilled worker pipeline. If political power can successfully be wrested from the boomers, the USA can abandon their entitlements and rebound quickly. If boomers hang on to political power: a period of sticky inflation and slow growth.
Boomers? Sigh. Please articulate better. You can't refer to an entire generation as 'at fault'.
It's dumb, greedy, selfish politicians, and they come from all generations, including yours and mine, and in the future they'll come from generations not yet old enough to run.
Boomers is a stupid term used by people who only understand easy answers.
No. Will only change if debt prevents reelection.
It does, but only for one of the parties.
Could you be more specific?
Democrats tend to get railed for it even though Republican presidents raise the debt more. It gives the impression that only Democrats are trying to fix it and Republicans give it more lip service but often make it worse.
It is "the party the President is in", typically. Today that happens to be "R" but the President has taken the brunt of the blame for good or bad economies for a long time now, regardless of how correct that blame assignment may be.
I expect various emergency measures to try to keep things afloat until the election. By "afloat" I mean, specifically keep the numbers everyone is looking at looking "good", mostly, the stock market indices, the various US Treasury rates, and the US Dollar Index. After that, who knows. And the fact that I expect them to try doesn't guarantee they will succeed. There's plenty of motivation for forces who want them to fail at that task to take measures to strike while the iron is hot.
I am surprised no one has mentioned the The Two Santa Claus Theory[0] in play here.
[0] https://www.commondreams.org/views/2009/01/26/two-santa-clau...
The news we read is optimized for edge-event cases. Here it's about a particular number being hit.
What's more interesting is the long, overarching news stories that span decades, e.g. BRICS, and the demise of the petro-dollar
Ah, I used to say that US debt in dollars is about the same as the amount of cells we have in our bodies. But "they" really took a big leap these past years!
Can someone speculate on how this will actually play out in the coming decades?
US government bond yields are regarded as the rate of return on a risk-free asset. So, for someone to decide to lend you money or invest in your business, you need to offer them a higher rate of return. This extra return is the risk premium. So when interest rates are close to 0 per cent, mortgages are cheap and everyone is prepared to risk their money on a slide deck promising significant losses over the next three years. Because cash yields next to nothing, investors race to generate returns elsewhere, which artificially depresses the risk premium.
If US bonds are at 5 per cent, your banker will add their margin on top and your bank loan will be at least 7 per cent or higher if they fear a rise in interest rates and inflation. Investors will be much more discerning and demand higher risk premiums to move away from risk-free yields. As there are far fewer sectors capable of offering such returns, investment will concentrate on a very small number of sectors and companies (does AI ring a bell?).
It is therefore the bond yield that affects us directly, rather than the volume of debt alone. The volume of debt does have an effect, however, as the bulk of the interest is paid by issuing new bonds. If the government repays with cheaper bonds, it isn’t too serious; but if rates rise, the impact on budget deficits is exponential.
The thing is, the more debt and interest there is to pay, the more bonds need to be sold. To absorb this huge supply, the market demands higher yields to attract buyers, which in turn drives up borrowing costs for everyone.
The other half of the equation is what the government is spending the borrowed money on. The effect on the real economy is significant and pertinent to market performance of sectors.
The Keynesian debt theory, the government should run up debt and support the economy during recessions, and then repay that debt quickly during periods of growth. This is not what is happening.
Repaying the interest on debt held by a Norwegian pension fund has only a very minor impact on the US real economy.
International buyers will cool on the idea of holding US debt.
US policy will artificially lower the interest rate to stimulate the economy. Also, the spending of the federal government will continue to increase above the tax receipts.
This will result in inflation. Which is great if you owe money, since you are paying it back with cheaper money.
But, the interest rates being low will make it easier to borrow? The resulting divide by zero in the economy (meaning an exception that there is no solution to) will result in the US government repudiating it's prior debt and making the 'new dollar'.
This will cause a couple of years of chaos.
Anyone can speculate. If we fail to pay interest in a timely manner, then presumably fewer foreign entities will buy our debt, and we will have less money from debt sales to fund what debt funds. Whether that pain is spread equally or not is anyone's guess.
If we fail to pay interest in a timely manner is potentially catastrophic. US Bonds are considered a safe haven because we have never defaulted on our debt
The interest is only part of it !
How about paying back the principle when the bond comes due?
The principal is repaid by issuing new bonds at maturity. This can be sustained for a long time if interest rates are low, but for much less time if rates rise. The volume of bonds being issued becomes so great that rates have to be raised to ensure they all find buyers.
It is not as though the US Treasury can afford to wait until it finds a buyer at lower yield. It absolutely must sell these bonds to pay off the principal on the old ones.
US bonds are a safe haven because the world’s oil supply is locked up by US warships.
Scenario 1: It will be nothingburger right until the time it isn't. US can't default on its debt - so massive inflation and money printing until everything is rebalanced.
Scenario 2: AI and robotics deliver growth on par with semiconductors and internet. Couple of decades of the economy growing faster than the debt will put it in manageable ratio.
USA is really rich in resources, extremely well defended by geography, so I guess they will make do even in the worst scenarios.
the rate of growth is the worrying trend.
then that the debt has been accelerating with either party in power - means this is a problem that won't be solved politically by the current actors i.e both parties.
Just stop. The debt has _not_ be accelerating with either party. Look at the deficit growth numbers under each administration
There are no adults left in the room.
Not gonna happen until dollar looses reserved currency status
Which is already slowly happening.
I've often wondered if US Debt has ever actually mattered for the US. They were complaining when Bush took Clinton's surplus and wasted it on wars, and grew the deficit to $10T (some was Great Recession bailout related). The complained about Obama when he added another $10T over his terms. Then a little when Trump did almost $10T in his first term (some of that was COVID related). Then a LOT when Biden did the same thing. And now Trump second term he's "only" added a couple trillion.
Don't get me wrong, these are giant numbers and we shouldn't be spending like this. But We have been spending way more than we bring in since 2003, and it hasn't been an issue.
You’re right, they’re just numbers. Relative to other economies they can tell us the strength of US hegemony but, the numbers are not a reliable indicator of themselves - because the money isn’t “real”.
man I have no idea how these things work at this scale, nothing makes sense to me, money is just the most alien thing we ever invented
Yeah MMT is basically beads and blankets for the island of manhattan.
Interest rates are still within "normal" range, so the market is signalling that's it isn't that big of a deal.
Countries have a debt crisis when their debt is huge and their interest rate is off the wall. Pretty much the market deciding that they are cooked.
Wake me up when GDP is stagnant and interest rates are climbing over 15%. The US is still the global leader on multiple fronts with a well diversified economy.
No
Who do we owe it TO?
My sources say no
Interest payments on the debt will be $1.2 Trillion this year.
There are about 164,000 individual taxpayers in the US.
So each taxpayer is paying around $7,300 each just for interest on the debt.
Which is more than Canadians pay in taxes for universal healthcare.
Assuming you meant 164 million taxpayers...
Your number is too low still. Half of those filers are not contributors, they receive refunds. The figure is more like ~65 million taking on this tax burden, so likely closer to 15k (rounding math)
I read a newspaper article about this. Apparently according to Dutch economists the US only has to raise taxes by a few percent and the deficit is fixed.
Not that they'll ever do that ofcourse.
I think this is a great solution. Raise some revenue. Tax the rich more. (not being sarcastic, we need more tax money coming in) I didn't say 'eat them', just reach into their pocket and extract more (double? sure...)
At the same time, pull back on the spending. Or maybe even pull back on the growth in spending. No need to go to a full Doge; rather just pull it back a bit.
Why we can't do this, I am flummoxed.
No.
at least half of that $40 trillion is from the nationwide militarization of the United States post 9/11
* https://ips-dc.org/report-state-of-insecurity-cost-militariz...
that level of military spending is never going down and will only increase by design
something the average consumer has absolutely no control over and no ability to solve
we just wanted healthcare and homes, instead we got endless wars and bombing civilians with tomahawks
>"something the average consumer has absolutely no control over and no ability to solve"
Of course they do. Grow a new fucking party and vote for it. Better than one half f the population hating the other half. Just what politicians of either branch enjoy.
If we had a government that educated people, potentially, but we don't, so it wont
I've seen extremely smart/well-educated people (not in politics or any skin in the game) argue the debt isn't really a problem. "It's not like your household debt" and all. This one probably isn't just about education.
That is the Fed educated position. The Keynsian view of economics sees the good economic times as normal and bad economic times as the aberration. Thus, from that view you go into debt to hold the economy over until the good times return.
I've always seen that as an excuse to spend more that you have. Its a trap that is difficult to get out. It is the same as taking more personal debt that you can service. But in the case of the government the bank never says no.
In small amounts, say <3 trillion dollars, the smart people are right. If the government needs to run a deficit to fight a war, or get the population through a pandemic, it is not a problem.
The problem is it is forever, and it is growing.
Fantasy that you can do this for 50 years.
To be clear, these folks very specifically refer to the giant amounts, not merely the small ones.
That's because the US national debt is indeed not like household debt. As a household, I can't choose to print more GlibMonkeyDeathBucks and hand them out to service my debts. I also don't have my own standing army to defend from creditors who might try to seize my hard assets.
Yes, printing money is inflationary.
The heavy damage done to the USA by means of self-sabotage is not unintentional. Public discourse/media is over-focused on Trump. Although he is over his ears in corruption scandals, he isn't the genius behind it. The ideologues behind Project 2025 are the real interesting figures, but we barely hear about them. Instead of root case analysis, we have daily drama and performances from publicity actors. The average Joe is distracted with all kinds of nonsense while the Overton window moves.
The real shit will begin when the financial world will factor in the chance of a successful self-coup. Hoping for the best, but it will take more than a decade for a constructive movement in power to limit the damage, and it will take a generation of cultural and institutional reforms to make the state more resistant against anti-democratic coups.
I thought the fiscal conservatives were in charge?
The financial illiteracy of Warsh, Bessent and Trump is the goddess's gift to China .
Pretty much like the 3 Stooges, the best they have to offer is nyuk, nyuk, nyuk.
Bessent is especially moronic financially, if he actually had what it takes to perform adequately in his position, Trump would not stand for it.
"No"
I look forward to hearing how we have to let more children starve so Trump can build more ugly monuments and we can drop more bombs on school girls in foreign lands.
Paging Ian Betteridge.