This year, U.S. national debt is set to approach 100% of GDP, up from 36% in 2005.
By 2035, the tab is projected to reach 118.5% of GDP as higher debt costs steepen the deficit, fueling further government borrowing. Today, the deficit stands at $1.9 trillion with net interest and mandatory spending outpacing revenues.
This graphic shows U.S. federal debt projections to 2035, based on data from the Congressional Budget Office.
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Unlike after WWII, there's no credible plan to get that number back down.
The debt is the big, ugly secret everyone's ignoring. As long as people keep buying US bonds, no one's going to take this seriously. It's the same old song and dance in Europe... Now I finally get what that crooked Portuguese politician was on about: debt isn't something you pay off, it's something you juggle!
They cannot pay the debt off....I don't mean that as a fiscal problem. Our money is debt (or, our debt *is money).
So paying off debt = destroy money. If they paid 50% of the debt off, that would be $17T in money wiped out (ie. massive deflationary collapse).
Until they get down to the couple of trillions dollars in actual specie.
Yeah, paying off the debt would necessitate a 90% contraction of the money supply. Although, the Treasury could always crank up the actual printer.
Heres your choices:
we should be able to cut federal budget to fiscal year 2019, i.e. pre Covid spending levels
That should trim 2 trillion annually?
update: paying down debt is unnecessary as long as we don't default on our bond payments
What happens to the holders of dollar denominated debt with the bitcoin plan? It seems like that's just a variant of one of the other three choices.
They will receive dollars that may not be worth much in 30 years.....they too should transition to bitcoin standard.
(btw, I just saw someone on twitter post a "BitBond" strategy that is clever. When bonds are sold, Treasury allocates 1% of funds raised into bitcoin and held in cold-storage. At maturity, Treasury pays back 99% fiat and the 1% BTC.....)
The 2 biggest liabilities are Medicare and Social Security.
Eventually we have to privatize both. The other option is we pay everyone off with a lump sum (present value discount).
This is why I think a SBR is such a good idea....not for some silly notion that we will use bitcoin to "pay off the debt", rather a national SBR will encourage and greenlight everyone to adopt a bitcoin standard.
The only hope we really have is to "soft-land" everyone into a bitcoin standard, and let the debt and dollar just zoom away...
This debt ratio today is embarrassing, at least in 1945 we could use a world war as an excuse for racking up debt
Clearly you're forgetting about the Global War on Terror. I'm sure that'll wrap up any day now and all the excessive spending will go away.
I can't imagine there's going to be a soft landing on this. The wealth transfer as this debt gets defaulted on is going to be insane.
Let’s go Broke! Bitcoin will eat it up!
The fiat standard is broken and only the Bitcoin Standard can save it. Tick tock next block!