Given these realities, the only feasible way to reduce the national debt to sustainable levels would be a combination of: Moderate GDP growth (3-4% annually) Sustained budget surpluses (achieved through both spending cuts and revenue increases) Controlled inflation (around 4-5%)
However, this approach faces severe political hurdles. Policymakers are unlikely to agree on the necessary spending cuts, tax hikes, or monetary policy adjustments needed to make this happen. Additionally, these projections do not account for the over $120 trillion in unfunded liabilities the government is committed to paying in the future—mainly through Social Security, Medicare, and other entitlement programs.
The belief that the United States can “grow” its way out of debt, as it did after World War II, does not hold up under scrutiny. The economic conditions today are vastly different, and no single factor—be it growth, spending cuts, or inflation—can resolve the debt issue alone. The only realistic path forward would require a politically unpalatable combination of all three. Without serious fiscal reform, the U.S. debt problem is not going away anytime soon, and kicking the can down the road will only make the eventual reckoning more painful.
Another default, albeit a technical one, as in 1790, 1862, 1933, and 1971, seems inevitable.
I think this author has is right, unfortunately. I think there will be some sort of default, but the big question is to whom this default will be placed. We are already considered chattel by the powers that be and the country has been given up in previous defaults, so what more is there to give up, our souls? Perhaps we should just tell all of the debtors to just go to hell and not cough up the collateral? Wait, wait, don’t we owe all that money to ourselves? Somehow I don’t think so. This next default may just hurt a whole lot.