“Everybody who reads the newspaper knows that the United States has a very serious long-term fiscal problem,” said Fitch in its downgrade of US debt.
Government Expenditures and Receipts Notes
- The Bureau of Economic Analysis (BEA) numbers are incomplete for the second quarters so these numbers are through 2023 Q1.
- Expenditures are $6.443 trillion while receipts total only $4.779 trillion. That’s a gap of $1.664 trillion.
- Transfer payments include Social Security, Medicare, Medicaid, and Food Stamps. The latter is now called Supplemental Nutrition Assistance Program (SNAP).
- Mandatory government spending includes Social Security, Medicare, and Interest on the national debt. Interest at $929 billion now nearly equals defense spending at $959 billion. The latter is understated because it does not include homeland security and other expenses that are really defense related.
Expenditures and Mandatory Expenditures vs Receipts
Mandatory Spending Chart Notes
- The yellow line represents mandatory spending plus defense spending.
- Total receipts are $4.779 trillion.
- Mandatory spending plus military spending is $4.851 trillion.
Liars and Hypocrites Everywhere
Neither party is willing to cut Social Security. And recent vote on the defense budget shows that by an 88-11 margin, neither party is willing to cut defense spending either.
To eliminate the deficit while maintaining mandatory and defense spending, Congress would have to eliminate all other spending.
Of course, that’s not going to happen despite constant Republican chatter of reducing the deficit and balancing the budget.
Beyond Ridiculous Tweet
Government Expenditures Minus Receipts
There was no surplus in 1999 or 2000. Proof can be found by looking at national debt which rises more than the alleged deficit every year. This happens because the BEA does not count Social Security as a deficit as if here really is a trust fund when the money is really spent.
US Debt Clock 2023-08-02
The above image is from the US Debt Clock.
If you have not visited that site, I suggest you do. The chart is interactive and updates automatically every second.
Note that total US debt is now approaching $33 trillion and was “only” $21 trillion when Trump announced he would use tariffs to pay down the national debt. Did anyone really believe that?
Senate Votes to Throw $886 Billion at Defense. How Much Money is Wasted?
Yesterday, I noted that by an 88-11 margin the Senate Votes to Throw $886 Billion at Defense.
For a look at how much is wasted, please check out my report.
As Fitch says, “Everybody who reads the newspaper knows that the United States has a very serious long-term fiscal problem.” But what are we going to do about it?
Curiously, as a side note, the debt downgrade was realistically unwarranted. Debt downgrades pertain to risk of default. That specifically means, not paying interest. It does not at all factor in inflation or a sinking value of fiat currencies.
Since the US is no more likely to default in the required sense, the downgrade was unwarranted even though the Fitch comment was totally accurate. The US has a major problem.
For sovereign entities using their own currency, “default” should have a secondary definition as repayment in debased currency. If the fed promises a 2% long term interest rate, then it’s actions cause currency debasement, I would regard that as breach of contract with bond investors. If you don’t include the effects of government induced inflation, it makes zero sense to put a rating on any sovereign debt.
Of course the downgrade was warranted. Given that the debt is in own currency the USA can always print to pay, so that form of default is indeed impossible. However, given the USA has shown absolutely no restraint on seizing the assets of anybody who displeases them the real risk then becomes that the USA can always pay IF THEY FEEL LIKE IT, BUT THEY MAY NOT IF THEY DON”T LIKE YOU. The credit ratings of the USA and European nations should all have been torched when they got sanctions crazy, because “freezing assets” or outright stealing gold are clear indications that simply refusing to honor debt held by any entity the country chooses not to pay for political reasons is potentially only a baby step away. A growing history of disrespect for the rule of law regarding the assets held by others is a huge risk. Its just no ratings agency would ever have the balls to say this. Even if you say “don’t be on the bad side of the USA and its still AAA”, that may be true but the rating is for a generic holder and not a toady, no?
There is more honor among thieves.
‘“Everybody who reads the newspaper knows that the United States has a very serious long-term fiscal problem,” said Fitch in its downgrade of US debt.’
Except that everyone is on line and no one reads newspapers anymore.
According to Trump there is no downside to tariffs. It’s all no cost gains to the U.S. treasury. Of course they have no impact on the U.S. consumer. Of course I’m sarcastic with my last sentence.
I’ll still vote for Trump if he’s the nominee. The alternative is far worse.
The TV keeps shrieking that at you, and you have been made a believer.
Has nothing to do with policy, and everything to do with identity.
Wusses vote for the lesser evil. Real men/women know you’re not acceptable breeding maternal.
We’re at the beginning of the end. We have out of control spending in conjunction with higher interest rates. Interest on the national debt is going to accelerate from here. And it’s going to compound. The people in charge have at most 10 years of life left, so they don’t care.
Kid, this is just near the end of the beginning.
It’s going to get a lot worse.
The next crisis is barely on the horizon.
Thanks for pointing out the sham of the Social Security Trust fund. It just was a big tax increase which allowed more reckless government spending. When one goes to the trust fund, one finds a bunch of IOUs which are made good from the general revenues.
About 50 percent of the Federal debt is under 2 years.
Combine this factor with the constant roll-over of debt and it becomes obvious that the burden of higher interest rates will be compounded.
The burden becomes a function of the major portion of the debt, not just the current deficits. The burden, in fact, becomes exponential. In other words, if the trend is not stopped, the debt inevitably has to be repudiated.
Repudiation is for wooses.
Fin de siècle américaine; as someone mentioned it’s just a question of how long it will take.
” Après moi, le déluge ”
It’s not a plan, it’s an adventure.
Indeed the rating was unwarrented because all the Fed needs to do is log-in this morning and add a few zeros here and there and WALLA! More money is created, debt disappears, whatever they want to do, they can, unimpeded.
So, guess this means the Trump tax cuts that expire next year will not be renewed.
Not really.
The Fed has to go to the US Congress.
Threaten them with dire consequences.
Get a quick law.
Have it signed immediately by the POTUS.
Then go back to the office and create the money.
You can do this all with Lyft or Uber.
Expenditures minus receipts chart is reversed; shows that the government is spending less each year than it takes in.
Almost 33 trillion debt so what are we going to do about it? Nothing until there’s a crisis. We have this problem because we have weak leaders, and these leaders reflect a weak bunch of selfish Americans. At some point a crisis will force the Fed to once again bailout the banks with massive liquidity injections which along with other political bailouts, will spike the inflation rate. This will precipitate all kinds of controls, wages, prices everywhere which will lead to a dramatic increase in shortages of everything. As defaults begin to spread, shortages of food, gasoline, electricity drives the country to a desperate situation of civil disorder which will probably cause the government to demand martial law to restore some sense of order. This crisis may very well include the whole world as an extremely serious American financial crisis will have worldwide financial implications especially when some debt has to move to default. At least perhaps to survive Americans would finally begin to have to work together for some sort of stability is the only reason for optimism or hope I can envision for the future. Competent leadership which has been lacking for so long in America is desperately needed in this situation for the country to survive.
Knowing Fitch was paid by banks to rate CDO’s “AAA” all the way up to 2008, I’m curious as to who paid for this rating? ….Maybe a few big banks needed a market shift for their portfolio’s, or something.
Found this on Google –
“Fitch Affirms & Removes 7 Short-Term CDO Ratings from Rating Watch Negative Based on AIG’s Rating”
Wed 09 Jul, 2008
I don’t debate U.S. debt problem, but seriously, ratings companies are little more than trash after 2008.
.
.
Just let the government starve itself in interest payments. Our taxes will go to the bare necessities set forth in the Constitution and the rest will pay the bondholders. Seems simple enough to me.
Doesn’t China suffer from this debt downgrade since the mark to market value of the US bonds it holds is now worth less? It will take more US bonds for China to buy mines around the world.
Is Fitch trying to influence the 2024 election by creating a less than desirable economy to get voters to turn their anger toward Biden?
Or maybe the FED put Fitch up to this because their monetary policy isn’t offsetting the government’s fiscal policy?
the fed cares about only one thing. keeping her owners solvent and profitable. the nyc money center banks. all the rest of it is just kabuki theatre for middlebrow analysts and lumpenprole workers……
I’d like the JS-kit thumbs buttons and the way to have an Ignore List again.
hear hear. i second that motion.
The government’s credit rating was last downgraded in 2011, after a similar standoff over the debt limit, by the agency Standard & Poor’s. In a statement, Fitch said the revision Tuesday reflects both the standoffs over the debt ceiling and the federal government’s “high and growing” debt burden.
Same story in 2011. Same story today. Same responses from the doom and gloomers. The sky is falling. The US is toast.
In 2011 the Dow was around 12,000, Today 35,000. S&P 1250, today 4,500. Wow. The US wasn’t toast after all!
Perhaps in a few years, Moody’s will downgrade US debt as well and we will have to listen to all this doom and gloom again.
In the meantime, the wise will continue to work hard and smart to improve their lives while the doomers re-stock their survival bunker and bury their gold.
“In the meantime, the wise will continue to work hard and smart to improve their lives while the doomers re-stock their survival bunker and bury their gold.”
That sounds very quaint… but you didn’t mention who was gonna fix the math problem.
The world is full of problems. Always has been. Always will be. The key is to know which problems you can impact, and which problems impact you.
There was nothing I could do about the debt problem 50 years ago, 40 years ago, 30 years ago, or today.
And the problem will still be here in another 20 years.
All I can do is to figure out how it impacts me and how I can profit from it.
I will leave it to others to run around like chicken little.
If you are so concerned, I guess you can go fix it. Good luck.
just a small quibble. this is a democracy. and as ancient men knew in greece/romans who invented this game, one should spend time engaged in the self rule concept. one should be voting, running for office, lobbying for the betterment of society. if one just goes off to fend for themselves and say it is futile, one is living a life not really worth living as a free man. one is then just a nihilist. but if that is the path you have taken, so be it. after all we don’t live in kingdom or totalitarian empire like russia or china or saudi etc……..but i get that most modern amerikans have given up being proactive in their democracy. nihilism is what they do. democracy works. nihilists elect nihilists. war mongers elect war mongers. peaceful folks elect peaace ful folks. democracy works. for past 2500 years in west and much longer in some indigenous societies.
It’s actually NOT a democracy, it’s a Constitutional Republic. Though it is functioning more and more like a feudal society. Whether or not Casey told Reagan that the goal of the CIA was to have everyone in America be wrong about everything, the results speak for themselves. It’s not just you on this. Just another feature of having the state responsible for your mind.
I don’t vote. Waste of time.
Things have gotten kooky, and kooks are a bad credit risk.
The Great Depression was a real event, as was WW2, which was part of it.
In 2010 I bought a very nice used car for $10,000.
Same used car today about $30,000.
Hmmm.
And I am due for a car.
In 1977, my dad sold me, at a premium, his 1971 bug. No discussion. $25 a month payment. $750 total. Most of my cars were$500 specials, and were good to go. Plus, I could tear them down and put them back together. The slaves all brag about how much higher the stock market is today, but they’re too stupid to understand how inflation debases a currency.
Politicians need to take a remedial arithmetic class.
They might fail that too.
Since the federal government is out of control it’s time for the states to hold a constitutional convention and put more restrictions on government spending.
So if you buy a treasury note you will be happy if the government only pays the coupon payment and never pays the principal? I think that default is if you don’t repay your debt according to the terms of the loan.
Without the Bush and Trump tax cuts (Obama had a much smaller one) then the deficits would be much smaller. link to americanprogress.org
I know Republicans will scream at the above statement but it is true. Cutting taxes without cutting spending increases the deficit and the national debt. If they were serious about debt they would have reduced spending by an equivalent amount.
“So if you buy a treasury note you will be happy if the government only pays the coupon payment and never pays the principal? ”
Most people would love this. It’s called an interest only loan.
What happens at the end of the bond is that the government just refinances (roll over) at the new prevailing rate, they don’t default.
… and the rate would likely be higher each time. We’d all be millionaires in no time!
“ … and the rate would likely be higher each time. We’d all be millionaires in no time! ”
This is exactly what is happening.
Unless, of course, it is decided to pay a lower rate than last time. They do this repetitively.
Doesn’t matter how much the government collects. They’ll spend more. If we hadn’t cut taxes, the extra taxes collected would have just been added to expenditures.
When the Financial Service Regulation Relief Act os 2006 was applied the Fed confiscated and transferred wealth to the unemployed, to shingle mums, to small business owners, to the restaurants, stimulus checks…but the rich fooled the poor.
1) If we hit a recession US gov debt might rise to $34T, to the debt ceiling,
faster than intended, before Jan 2025.
2) The deficit might reach/ breach 2020 low. COLA and transfer payments might
be negative in real terms.
3) The defense spending might be cut. We will sell weapons, but consolidate our positions in the world. The DOJ, DOE…unfunded politician promises : cut, cut, cut.
4) The front end for dividends. The long duration for capital gains.
Most important comment on this post:
We rule the world.
I’m literally not worried one bit. I’ll be dead before it matters, and that’s decades away.
“we?”
You and I rule nothing.
I rule myself. And no other. As is our birthright. Just takes some big ones.
Until you do something the others don’t approve of, and they put you in a cage.
I do things every day that others don’t approve of. You’re just giving the typical coward response so that you can excuse yourself from living your life wild and free as we were intended to live. Sucks to be you.
Oooh! A rebel without a clue!
I have a clue. I figured out this scam 20 years ago. You’re just a typical slave without a spine. You should try growing one. They’re really handy.
You are lord and master of mamas basement.
You’re the one who keeps their mind in a prison. It takes a real coward to mock someone for being a man. Also, I live in North Florida. Swamp country. No basements here. But plenty of gators.
Maybe we ruled the world 30 years ago, but certainly not today.
During the first decade of me working, I was reading lots of news stories and even a book or two on the national debt. Thirty years later, the end of the world has yet to happen — we appear more flush than ever — every college campus and every hospital is brand new. The American financial system only melts down if we want it to melt down, and NO ONE ON THIS PLANET that matters wants the American experiment to end — there is nowhere else to go. Ive heard the thing where if we confiscated all the wealthy’s money, it wouldnt be enough. Of course not. It took 50 years to get here .. the solution will take 50 years also … one year, at a time, of revenue increases.
Absurd
“ one year, at a time, of revenue increases.”
You misspelled spending cuts
85% of Federal spending is in WILDLY popular areas: SS, Medicare, Medicaid (Federal portion), Defense and Interest on the debt (FDIC protection for billionaires). What spending cuts are you talking about? There are none. Unless you mean the .00000001% spent as foreign aid.
Defense, entitlements, various regulatory agencies, stuff like that. Sure programs are popular. You may be surprised to know taxes are unpopular. Everyone wants to keep their money and also take someone else’s. That is why we are where we are. I errr on the side of not stealing money from Peter to enrich Paul.
I agree taxes are unpopular. So is charging $10 for a hamburger. But if you want things, you have to pay for things. In the 1940s and 50s, well-off people paid a marginal rate on Fed taxes of 80%ish .. they thought they were doing it for America. Today, in a desperate country, with flat earnings for 50 years, which allowed the rich to get richer, every dime is sacred. You mentioned Defense and Entitlements, which will NEVER be reduced. Try foreign aid and arts and humanities and you go nowhere. You want it — you pay for it. Half of Federal taxpayers pay NO Federal income tax. Riding for free.
There are no free rides. Sales taxes, fuel taxes, etc. Most importantly, inflation is a tax. The people on the free ride actually pay the most in many ways. It’s just simple math. Helpful when you are working with fraudulent scenarios like our government.
Armageddon always shows up late.
Armageddon is where you show up, not when.
*Someone* has to buy all the newly issued US debt. Since it’s now downgraded from AAA it means to entice buyers the government is going to have to increase yield (interest paid).
That increased yield means stocks should be taking a hit (today down 2% for example). It’s yet another harbinger of an upcoming stock market correction as more and more people pile into what’s seen as a safe return.
Such a joke. Of course the deficit rises every year. A premium service of central banks. It’s just spinning out of control now. It is being done intentionally, and is pretty much unstoppable now. I think it’s a good thing. But once you understand that government is just a narcissistic construct, you know that the only way to win is to not play that silly games. But the slaves so love their gaslighting ways.
Of course it is narcissistic. The heads of state and other “lawmakers” are winners of popularity contests and are not judged on mental fitness or how they look in evening wear.
There was a time when there was some dignity to this, top hats and all.
But that’s been gone for a long, long time.
The dignity and the top hats.
Those were merely costumes. It’s always been a theater of the absurd. Always more room for spin doctors in history.
I love USDebtClock.org
If you haven’t yet, click on the time machine tab too.
Here is a fun way to spend your time with some youngsters this next year when they decide to do RoboCalls for Political Campaigns.
When thy say they are promoting a candidate, ask them what are their plans to pay down the National Debt.
You’ll start to hear crickets and excuses.
But the best part is that hopefully you set something in motion.
Joe Biden 08/16/2020:
“Here’s my promise to you: if I’m elected president…I’ll take responsibility instead of blaming others.
Joe Biden, TODAY:
“This Trump downgrade…”
Politician’s go us into this mess and they are not capable of getting us out of it.
Even zeroing defense spending would not cover this deficit. Federal medical spending is over 1/3 of outlays and growing. People are terrible at recognizing exponential series until they explode, but federal spending is growing exponential. I would be very surprised if the federal budget survives another 5 years.
Inflation is default.
Yes, I kind of look at it that way too.
With 2% inflation the cost/price of things doubles in about 35 years.
So if I buy a 30 year Treasury the Government will give me a little over half of my principle’s spending power back at maturity. That’s a good investment?
Obviously Treasuries are for trading not for holding.
John Cochrane (The Grumpy Economist) explained it pretty well this morning.
While I believe I understand the intent of Fitch, it will have no impact on the current spendthrift bunch of worthless bureaucrats who will spend whatever it takes to get re-elected. In their warped minds, they believe overspending on projects and etc., is their prerogative and God given right. The only answer is to throw the bums out and initiate term limits. The public must demand it.
Since the Supreme Court held up SuperPacs as a free speech right, the country has no hope now. Every weasel in Congress is on the take and captured by corporate interests. Remember when AOC had some values? Now she is wearing 1000 dollar pantsuits and pimping the Ukrainian War. The Electoral system is well enough rigged that the desired candidates always squeak by as well.
They all get a little chip change and are part of the industrial complex that is running the US into a debt trap which eventually lead to it’s demise. Probably broken up into regional countries or each state becomes sovereign. For the EU and China, much more manageable as well. Right now US is a bad actor behaving badly and wrecking havoc across the globe with it’s militarization of everything and weaponization of financial systems. Kiss it so long, it’s over baby. There is NO WAY the US can become solvent anymore. It will hit it’s Minisky Moment soon enough. We can all thank Clinton, the Republicans for killing off Depression Era safeguards with banks. Reagan ran up silly deficits to run the cold war. Bush all the way to Biden just made things worse and worse.
Reagan doubled revenues. The Democrats ran up the deficit by tripling spending.
Ridiculous. Reagan obligated a trillion to dod when a trillion was real money. Ron set the records for deficits compared to gdp!
Govt revenues doubled under Reagan’s administration. Congress allocates spending, Democrats controlled Congress, and spending tripled. Thus the deficit. Those are the facts and numbers.
Reagan is still crippling our economy with all the offshoots of his idiotic death star. Now we just need 200 million nukes to stop North Korea from annihilating us. It’s insanely childish to believe he was some kind of economic savior. He merely proved why “I’m from the government, and I’m here to help” is such a scary phrase.
Insanely childish. Right. Just pointing out the numbers.
Cocoa, I agree 100%.
The citizens haven’t had representatives for as long as I can remember.
That’s because they’ve never represented you. Only you can do that. It’s also a big reason we grew a spine. Though there does appear to be a lot of people with some serious bone density issues. Just read all the slaves talk about how they would do things. Absolutely clueless.
Don’t blame big corporations for this mess. We need to look in the mirror at who is responsible.
Boomers (for which I am one) decided to vote for any moron promising to lower taxes and/or increase benefits.
For example, as average lifespans increased from the 1930s (life expectancy of a male, smoker, working in a manufacturing environment on 30s, 40s, 50s?), Social Security program should have adjusted to substantially extend age of retirement and/or substantially increase mandatory contributions to match actuarial change. Few minor changes.
Then Medicare (cinder block hospitals of youth, now 5 star hotels), then Bush prescription drug benefits (explosion of pharmaceutical miracles for conditions unknown a decade ago).
Infrastructure built by greatest generation – we used and left in total disrepair. Public sector unions dictating pay/retirement benefits. On and on.
Our generation incurred this large debt but we sure as hell will vote out anyone who even suggests entitlement reform Biden/Trump.
Fatal flaw of a democracy, required informed, considerate, citizenry thinking beyond their own needs. “A republic, if you can keep it.”
Only solution is a Constitutional Convention to correct fatal flaws of our democratic republic. Repeal 17th Amendment also a good start.
“Since the Supreme Court held up SuperPacs as a free speech right, the country has no hope now.”
Doesn’t matter either way. 100% of booms go bust. In Biblical days, the year of Jubilee was every 50 years. Whatever form it actually takes, there is a mathematical reason Klaus Schwab talks of a Great Reset. The cycle is coming back to zero degrees. Math just is. The problem is that the math creates civil unrest.
The only realistic thing each of us can do is, to get our families prepared. God only knows when the wheels come off this clown car, but I would NOT want to be stuck in an urban environment when it happens.
Get yourself some rural land. Establish an independent water supply. Consider what you will need in a world with no internet or electricity.
Dream on
Nothing will change in America until the world repudiates its fraudulent currency ….
Our government is a literal circus now. Prepare for more hilarious hijinks!
Well the rating downgrade does relate to the risk of default. To service the debt they will just create more money, that gives them some time as the inflation does its bit. But can they keep the ponzi going for say bonds that mature in 30 years or will they hit a wall and de facto default by ending the USD as it currently exists. They can’t run a ponzi of exponential growth in the debt for another 30 years as at some point the annual interest will exceed 100% of tax revenue and that will occur well under 30 years. Could the interest bill even exceed 100% of GDP? Easy to see that happening as some highly indebted countries like Egypt are paying half their tax revenues on bond interest and having to offer 25% yields to attract funds. Only takes less than a generation of double digit growth in US deficits and paying to offer double digit bond yields to finance that debt to pass 100%.
Easily solved! Just make millionaires and billionaires pay their “fair share”. Bernie and Liz say that’ll fix it and they like have calculators and stuff.
You can literally confiscate all the wealth and assets of the super rich and the rich and STILL NOT have enough money for all these programs. We have a spending issue that has no revenue solution. We could revert to 50s and 60s tax code and increase taxes, confiscate all the wealth of 1% and we still are going to run a deficit and not pay down the debt.
Obvious solution is to cut military spending, Big Intelligence spending, Homeland security, Dept of Ed and a whole bunch of rubbish government agencies down to the nub. We have a ridiculous number of bases around the world and sending money to places like Ukraine to make Raytheon happy? Is that good for longterm prospects?
My comment was hopefully obvious sarcasm. I don’t really disagree with any of that.
I suspected, but your “calculators and stuff ” line cemented it.
I propose we take all the billionaires assets and sell them off. Then split the proceeds evenly to everyone else. We should have a vote on that. I suspect it would win overwhelmingly. That’s the democratic way.
They could try to force everyone to use CBDCs and tamper with/mess with/ruin the value of the dollar in the changeover process…
Considering the value of the dollar is about 1/50th of what it was, I’d say the ‘mission accomplished’ banner can be pulled out of storage.
The dollar is worth far less than 1/50th of what it was. What is the gold in a $20 double eagle worth? About $1900 so nearly 1/100th of what it was worth.
It may be worth less, but “far less” is hyperbole. 1/50th of a dollar is $0.02 and 1/100th of a dollar is $0.01 — in essence you’re saying that ‘nearly 99%’ is far larger than 98%.
Either way, the mission has been accomplished.
Which is exactly what I’ve been saying they are doing for quite some time.
exactly correct. the us already defaulted in 1971 and in 1933 on their currency. defaulting on their bonds when interest exceeds revenue is certainly coming. not if, just when. amerikans really have no clue to history of money and debts. quite remarkable for folks that attended college. or high school and have the luxury of time to read and study.
Revenue has nothing to do with making timely interest payments when you have a central bank.
However, things might get dicey if some folks start wanting their principal back.
You should have added national debt to that first graph just to see how ridiculous that probably looks.. Of course that probably would have flatten all the rest of them down to flat line.
It would make the other lines meaningless
Social Security can be easily fixed, the really big problem is medicare and medicaid. Unless we dismantle the medical monopoly it will collapse the government and the economy with it.
With over 20% of GDP dedicated to the Medical Industrial Complex, and 5% of GDP dedicated to stock buybacks; we are talking about over a quarter of our economy dedicated to broken windows. What could possibly go wrong????
Haven’t you heard? Unless drug companies can make at least $10b/yr in profits, they’ll stop developing drugs. It’s not worth the effort to only make $5b/yr.
Note: Trump has not been POTUS for 2.5 years. Two words were absent from this article: “Biden” and “Democrats.” Too bad the GOP voted for all of the crazed increases in spending for “Covid” and the Green New Deal, but you’d never know from this piece.
When it comes to national debt, I doubt the president has very much clout to constrain congressional spending. When was the last time a big spending bill was vetoed? I don’t know the answer, I’m just asking.
Congress makes up the spending bills, not the president.
The members of congress are highly unlikely to curtail spending. That spending feeds money to the corporations they own stock in. It feeds money to the corporations that give them campaign contributions. There is simply no structural incentive to really cut spending.
They spend. Our dollar’s value shrinks.
Call me a pessimist.
The takeaway here is the US will not default. The Fed will not destroy the only thing that affords them world dominance. To believe so is naive.