The following chart shows federal debt vs population growth. It’s a vivid reminder of the unwillingness of Congress and either party to put an end to unrestrained spending.
Federal Debt Chart Notes
- Debt is for fiscal years. 2023 added manually.
- Population is the civilian noninstitutional population for a calendar year.
- The civilian noninstitutional population is defined as persons 16 years of age and older residing in the 50 states and the District of Columbia, who are not inmates of institutions (e.g., penal and mental facilities, homes for the aged), and who are not on active duty in the Armed Forces.
- Yellow highlights are years just prior to recession years.
Federal Debt vs Population 1992 vs Now
- In 1992, the federal debt was $4.027 trillion. The population was 192.805 million.
- At the end of 2023, federal debt was $32.690 trillion and the population was 266.942 million.
- Between 2019 and 2023, the federal debt rose by 45.3 percent. The population rose by 3.0 percent.
Percentage Change in Debt and Population
In the last four years, the percentage increase in population was 3.0 percent. The percentage in crease in debt was 45.3 percent.
Increase in Debt Relative to Increase in Population
With every recession, the increase in debt relative to population goes up. And what about employment?
Over 100% of the Increase in Employment Since 2020 is Foreign Born
US-born employment is lower now than it was in January of 2020. Foreign-born workers make up over 100 percent of the employment gains.
For discussion, please see Over 100% of the Increase in Employment Since 2020 is Foreign Born
Bidenomics is largely a matter of increasing debt at the highest rates ever.
Cost of Biden’s Energy Policies
The cost estimate of Biden’s Inflation Reduction Act coupled with EPA mandates, just jumped by $466 billion.
Please note The CBO Revised the Cost of Biden’s Energy Policies Up by $466 Billion
Fiscal recklessness is not just Democrats.
Republicans agreed to expand child tax credits that will cost $1.5 trillion over 10 years.
For discussion, please see How Much Will That GOP Deal on Child Tax Credits Really Cost?
And Senate Republicans (and conservative news sources like the WSJ), are fuming the House will not throw another $95 billion at Ukraine and Israel with no strings attached.
Fiscal madness is everywhere one looks.
Hopefully, Trump doesn’t default on the debt, and threaten the takeover of foreign tax havens to pay down future domestic obligations, if an amicable writedown can’t be negotiated.
“What, me worry?”
—Alfred E. Neuman
The debt panic salesman never change. Year after year, decade after decade, its the same nonsense:
Everybody panic! DEBT is scary and its about tonwreck us!. I cant explain (I wont even try) why my previous 457 panicked warnings turned out to be wrong…but this time I am right! After all, just look at this random, out of context scart chart!
This is such a huge emergency that we must do something quickly…..but not the things I dont like (this isnt that big of a deal), nor the things that will impact me in any way (lets remember what the goal is here) and only the things that I would support even if debt levels were at zero!
Stay tuned for my broken clock debt alarm next year (unless the other party is in power and we forget about this!)
Lol, this comedy act never gets old. Rinse and repeat the silliness for decades.
Treasury & FedGuv are simply front-running the consequences of their Open Border + ForeverWar policies.
Elementary.
The border is open because you and I have no inclination to work 6 nights a week in a meat packing plant in Indiana.
Unemployment goes to 20% and perhaps that changes.
Helping tax payers keep more of what they earn (tax credits) is not the same as spending. Yes, there should be zero deficit spending, but it must come from spending, not more taxes.
Of course this will never happen, as that is not how you win elections, which is why short term-limits must be on the platform of any serious candidate, and don’t tell me it’s only needed during this time of fraudulent elections, as Kari Lake recently stated. Term-limits are always needed as long as campaigns are financed by lobbyist and big donors.
Term Limits and Campaign Finance Reform have been needed for a LONG time.
Citizens United should have been called “Lobbyists and Special Interests United to make Congressional Candidates Richer”.
Time to get these lifetime political money suckers out of office on ALL sides.
Population in 2023 is more than shown on the graph, about 70 million short.
Doesn’t include kids.
Which is foolish because kids are VERY expensive, especially in Healthcare.
Cheers!
Scamerica
Fiscal Death Spiral
We were blessed to be born in this beautiful country, looks like the crooks in Washington want to put this thing in the ditch with all the spending. I think eventually they will get there wish, and blame it on the public.
No, they the perfect pivot, Biden. Can not be held accountable die to mental deterioration from aging.
Not even willing to use usual scapegoat, Russia.
Ya, if we couldn’t back stab Ukraine we wouldn’t know what to do with ourselves.
How about thinking a little. Russia started this war, Russia can pay for it.
Russia has lots of resources, they can pay the trillions req’d to repair the damage they did to Ukraine + pay back all the money Western countries donated & cost of weapons donated to Ukraine.
yer rright ! ….except that Russia did not start this war; it was provoked by the world’s warmonger n° 1, the US of fckn A ! Ukraine is NONE of your fckn business ! Even the EU didn t want to touch basketcase Whorekraine with a 10 foot pole ! Till you somehow armtwisted, blackmailed or even bribed our idiots into going along. May I remind you in this context of your Nuland btch’s notorious words : fck the EU ?!
Ain t it just swell, someone from the other side of the pond of all places, stirring up your CNN brainwashed,libtard mind ? !
,
STHU we all know how this ends. Russia overextends itself in either Ukraine, just like they did in Afghanistan…OR they march a bunch of newly captured Ukrainians into Poland or the Baltic States on their Way to Germany, etc.
Then the US ACTUALLY has to send in THEIR kids or grandkids to stop the “next Hitler” named Putin or his successor.
Russian delusions of grandeur will cause them to screw up just like they have several times over the previous 125 years.
It will cost MILLIONS of LIVES and many, many TRILLIONS of Dollars.
OR the US and NATO can supply enough weapons and supplies for Ukraine to grind Putin to a halt, where he “declares victory but leaves, JUST like the Soviet Union did in Afghanistan.
Russia is a “has been power” that will eventually burn itself out like it did before the USSR collapsed. But ONLY if they’re stopped from rolling through Ukraine.
You’re welcome to volunteer and go fight Russia. Being a keyboard commando just makes you seem cowardly. It’s time to have some skin in the game. Go on and fight on the front line. The Ukraine needs all the warm bodies they can get.
No. They need Missiles and Ammunition for artillery and long range weapons systems.
The Russians are paying a terrible price for nonsensical amounts of territory gains, especially after they LOST almost 50% of the territory they originally captured.
This isn’t a manpower problem, it’s an equipment and weapons system problem and can be rectified in a handful of months if a handful of people pull their thumbs out of their arses.
Join reality. Follow Victoria Nuland and you will expose who started this war.
Greg = delusional
Maidan Coup (2014)… CIA & US State Dept. plan & manage a coup in Kyiv… the target of the coup was a democratically-elected administration… and afterwards US BlackOps began fortifying eastern Ukraine (russian-speaking), forcing those people to engage with Russia to defend themselves.
The USA encouraged, instigated & guaranteed the conflict in Ukraine… but RU is finishing it. Not sure why people like Greg are so butthurt about an obvious reality that was never in doubt.
Russia was ALWAYS going to win the conflict, and Ukraine was ALWAYS going to lose. The notion that “NATO” could fight a proxy war against a REAL military via a non-member state was & still is completely delusional & unjustified.
Massive waste of lives, resources & money… all thanks to the neoLiberal US DeepState (and stoogeNPCs like Greg), whose political/military/money-laundering interests in Ukraine began & expanded under the Obama admin., managed directly by Joe Biden.
facts > narrative. always & everywhere.
“Fiscal recklessness is not just Democrats.”
GWB: “We were attacked on 9/11.”
And the Democrats were 100% behind the trillions-of-dollars initiative to go into Iraq. Where were they to force us to rethink that foolish move? I beseeched them but it turns out people like you and all of them haven’t met a war they wouldn’t fund. I’m fine with you taking shots at the Republicans but you get no virtuous ground when you quote GWB and my party at that time proved they love ALL spending and ALL wars. 2024, nothing’s changed. Grab the moral high ground in the media clamoring about Republican defense spending as Democrats are fully onboard with every last pig slop dollar the MIC spends and without accountability for where it goes, refusing every audit language item in every Ukraine (and other) foreign war-fighting billions-dollar line items.
I agree that they are all a fiscally irresponsible lot, disgusting to the core, but Democrats get no shelter anywhere because, other than tax cuts, which all taxpayers benefited from, they spend indiscriminantly. Shame on them for backing Iraq and Afghanistan to the last drop. What result did we get? The past-due invoice.
One trillion missing from the ear whore pentagon and 911 shut that investigation, plus 4 buildings pulverized by two planes.
Convenient wouldn’t you say.
People don’t naturally understand exponential growth. This graph goes vertical in about 10 years. That means hyperinflation. You can argue the merits of inflation vs. deflation all you want until then, but at that point the money becomes useless.
We in trouble
Nah? Just another cat fight
The angle of the debt line increased dramatically with the Bush Tax Cut and the Trump Tax Cut.
2008/9 angle changed, you have eyes correct? GFC
2020 angle changed, Covid stimulus bills 1, 2 and 3.
Of course the tax cuts–we can argue that it benefited the wealthy but it also benefited the working poor as my daughter and son moved into net receivers of money, a negative tax liability, and my taxes decreased as well–impacted the deficit and debt.
However, the angle changed for the reasons I stated moreso than the tax cuts you mentioned.
You have to look harder at the graph to find the Bush and Tax Cuts but from 90,000 feet we can see the massive stimulus post GFC and Plandemic.
Let’s ask ourselves this question: given that there were 8 years of Obama and 4 years of Biden, why did the trajectory change on their watch and continue to remain elevated? If you wish to place blame on one side, why would you cherry pick those moments. Would you care to ask why the graphs move higher and stay higher from 2009 to 2024 given 12 years of Obama/Biden vs 4 years of DJT?
So tired of my former party refusing to take any responsibility. I begged my former party to BE the party they say they are, for the little guy. Unfortunately they have changed to the party of the powerful, rich, well-connected elite. Yet the messaging hasn’t reached the loyal Democratic voter.
Some other countries have adjusted for inflation simply by lopping off several columns of zeros.
Dividing the debt by the population, using the numbers in the top chart, I’m getting $122,461. per person.
Here’s how the average savings balances break down by age group, according to Federal Reserve data:
Age group Average balance
Under 35 $20,540
35 to 44 $41,540
45 to 54 $71,130
55 to 64 $72,520
So most, according to the Fed, that are not basically at retirement age (65), do not have nearly enough to cover, I dare say, their fair share. Don’t count on the seniors to do so.
We’re screwed if we are relying on Citizens to bail out the Government. Not only will the Government be broke, but everybody else will be as well. Let them try to sell that one…
And those figures are averages and I’m pretty sure “whales” push those averages way up. The median savings rate is so much worse.
Correct! I didn’t want to pile on…
That’s another reason why inflated home prices have kept the masses from getting REALLY angry. They believe they are (and currently they ARE) sitting on a massive, generally non-taxable nest egg in their home equity. I believe none of that equity is factored into your savings balances listed. Thus those amounts are much lower than reality, currently. If housing, and prices in general, crash, it’ll fix LOTS of things but the savings balances is not one of them.
We’ve allowed the children to be in charge for far too long because we can’t be bothered to force a change. When that change happens I’m afraid it won’t happen peacefully.
Money flow, not econ 101: in Japan all rates under 1Y are negative. Japan 10Y is less than 1%. The spread: US 10Y minus DET10Y narrowed to about 1%. If the Fed hike above 7% the yield curve might crack & break. It will be dissected between the front end, the middle and the long duration. At this point all rates are glued together. If inflation rises above 15% the Fed will be helpless. The anchor will break.
The debt chart (brown) doesn’t show Oct 2008 jump and the 2020 tsunami. It’s
too smooth. When the Fed hiked the upper middle class and the rich, – who constantly complained about the unsustainable debt – parked their money in the roach motel for 5%.
Imagine, the New York Times lies!
link to youtu.be
The colors for the left and right y-axis labels in the top chart are misleading and confusing because they are swapped. You had me completely misreading the chart for a minute.
And yet we keep voting in the same politicians that have ruled over this regime.
Vote out incumbents and vote in people that will negotiate, compromise and, even if slowly, turn this thing around.
I would be happy with a simple idea of cutting (government) spending 1 percent per year, while increasing taxes 1 percent per year, until the country is in better fiscal shape.
Would it hurt? Yes, just like saving up for a car or home hurts the instant gratification of buying an expensive dinner today.
But, if we elected pragmatic representatives, and made it clear that this is a priority of the populace, and such an agreement was announced, it would not hurt as much as waiting until the house of cards finally falls.
On top of this, we should be electing representatives that promote world peace, as opposed to constantly finding enemies to fight with, and constantly spending money on defense.
$14 Trillion of the debt could have been eliminated by avoid all the evil neocon wars.
True, but unfortunately neocons are dominant in both parties.
Plus another trillion or more by never starting Homeland Security after 9/11 or at the very least ending it after a year when it was obviously no longer needed.
All those groping searches and endless lines and yet not a single attack has ever been attempted (or foiled). Bin Laden’s attack has cause the US to spend trillions of dollars and countless hours in line against the idea of an attack that has never come.
Secret police are antithetical to the notion of a free country. You can’t have both. Any politician who claims to want to save the republic, who fails to specifically mention dismantling the Fusion centers is fake. Patriot act was reinstitute by bothTrump and Biden therefore they’re inarguably fake. Orwellian doublespeak, they’re the criminals who assail those who just want to be left alone.
If you need an emetic read some of the self congratulating bullshit these foul cretins spew upon one another at their Fusion Center (((meetings))). Disgusting that people who contribute nothing to society, can violate the constitution and monitor your every action, open your mail, read your texts and emails, track your every move, see who you meet with and listen to you and your wife have sex. They track your valve stem bluetooth emitters to see where you go. Their intrusive resolution into every aspect of your existence is absolute, to the finest detail.
It’s a proven fact we speak differently when we know someone is overhearing us. The fact they exist makes our world, a very different place from what it used to be.
What is the address of your regional fusion center?
Who works there?
What do they do exactly?
How big is their file on Mish?
Rest assured, it’s massive. People like Mish are monitored in real time 24/7.
All part of the Big Government build out. They stretched it out with all sorts of stuff! Took over healthcare for example. Took over (or decimated might be a better word) the Mental Health arena entirely, and just look at our streets. Opened the border up nice and wide. Turned public schools into teachings of the Government Agenda, and to become dependent on all things Government. Changed crime into mostly misdemeanors, and a catch and release program. The list is endless…
Not 1 war under Trump!
Unfortunately, it is difficult to say we really have elections anymore. In the Michigan primary, Biden got 80% of the vote. Two people I have never heard of got 2 and 3%. The rest was not committed. Democrats did not even run anyone against Biden, this year. In the last two elections, Biden ran 9th in the primaries and was nominated. Hilary ran 2nd and was nominated in 2016. Voters don’t seem to care or notice. We are headed for big trouble.
I believe most Dems are vegetarians and since Biden is a vegetable, voilà, he gets 80%.
$USD = global reserve currency
$USD = backed by US military capacity
US military is deployed when & where the DeepState wants.
The US DeepState is PERMANENT, thus there is no limit to the issuance of US debt.
Wake me up when rational US states secede from FedGuv.
“Bidenomics is largely a matter of increasing debt at the highest rates ever.”
Then Clintonomics was a matter of decreasing the debt at the highest rates ever.
The difference seems to be that Biden followed a President who implemented enormous tax cuts. And Clinton followed a President who implemented enormous tax increases.
You forget, that the Republicans were swept into office in 1994 and it is they that started to slash spending. Clinton vilified the Republicans for their cuts but was glad to recieve credit for the reduced deficit. Plus there were two other factors: the peace dividend from the crumbling of the evil USSR and the tech bubble of the late 1990s which fatted tax coffers. Even with that, the federal debt increased. You need to included the money taken into the SSI trust fund to get a surplus.
When the Fed prints dollars to buy government debt, which they did for at least a decade to absorb bond issuance and keep interest rates artificially low, they rebate the interest back to the federal government. This reduces the interest cost as shown in the federal budget, but also reduces the income to the Fed. This has left the Fed with a massive balance sheet ($800 billion in 2008 to now over $10 trillion) and essentially no relative capital. If we marked the Fed’s government bonds to market it would have negative capital (bankrupt).
Except having the ability to print dollars means you can’t possibly ever be bankrupt.
Being bankrupt does impair their ability to conduct Open Market Operations, as a large portion of the Fed’s balance sheet would go “No Bid” if put up for sale.
Another “baby step” along the road to hyperinflation.
The deficit ends up in bank accounts and the primary dealers are required to bid.
Socialism failed in every attempt. Socialism always ends in hyper inflation and dire poverty for all except the government tyrants.
Argentina is finally decapitating socialism that has impoverished the country for ,50 years
I can’t believe you went through all that analysis and failed to show the federal debt on a per capita basis. According to the debt clock figures
The federal debt per capita is $102,000.
The federal debt per tax payer is $266,400.
This helps to make the size of debt comprehensible. Who can wrap their heads around a trillion ( a million million). The government could have bought each taxpayer a vacation home but instead it pissed it away on wars and other useless ventures.
1) The new (and old) billionaires of the world want and now get their own FDIC insurance with billions of dollars in Treasuries. $250,000 limit? Thats for poor people 2) Not one of your readers can pick a program of any size that they would want to cut back. Almost all Federal spending is WILDLY popular
Me. Happy to cut social security and medicare and get my $1000/month back. No, I don’t need social security now or in 20 years.
I can take that money back and invest
$1000/month x 20 years at 10% = ~$800,000.
Maybe so, but remember that your $1000/month is going to current retirees and many of them need that money you’re supplying. Surely you don’t want to add to the federal defecit by making uncle sam fund his ponzi 😉
He says just before he needs a $500,000 lifesaving operation and then comes crying cause he cant afford it.
The $1,000/month is not for you. It is for current beneficiaries. It’s a pay- as- you- go system. There won’t be much left for you in 20 years.
You can cut medicare (under the guise of coming to grips with the cycle of life) but not social security.
The reason is millions are on it. If you cut it then those millions just walk into Walmart, grocery stores or even your home and steal what they need (food, water) and squat in your homes/apartments. You can’t jail them because we don’t have the facilities and even if we somehow did, housing a prisoner these days costs the same or more a year than just paying SS. Essentially you’d have to have death squads gunning people down in the street and we both know that’s absolutely not happening short of a civil war which is something no sane person wants to live through.
Sadly we see this happening now but due to massive inflation, which we know only benefits the upper middle class, already-wealthy, asset holders and those with access to first money. We are ALREADY seeing what you are mentinoing without cutting SS. The appelate court ruled they can tent-city in front of businesses in San Fran and I personally know of delinquent juveniles who steal from Wal Mart (and, thus me) every week. Dystopia of our own making and millions of people defending policies that perpetuate it.
Even sadder is this is just the beginning.
The worse things get and the more illegals that stream in the more people that fall into these tent city/petty theft category. Eventually when the numbers of people get large enough it will become a big problem (see what’s happening in Europe with the farmer protests). Left unchecked it will end up like it did in France in the late 1700s with a violent revolution and Guillotines.
I have actual Venezuelans begging on my main street in Chicago, and in front of the grocery stores, and they dont look like much of a risk to anybody, unless you are afraid of 4 foot tall women and their 2 year olds. 🙂
I can and very easy to do
Which line of the Federal budget do you want to cut? 85% of it is Social Security, Medicare, Medicaid, Defense, Interest on the Debt, and Veterans programs. Which one? And dont say foreign aid as that is less than 1% of the Federal budget, or all the Congressional salaries cause that is even less.. It’s ok. When Repubs are asked this question, they usually freeze up.
How many immigrants coming across the southern border are needed to rectify this? And then family units after arrival having lots of kids, to offset demographic decline. Jefferson wanted Mexico. Burr wanted to be King of Mexico. Like Mohamed and the Mountain now … In the American Empire, an “American” is more or less a data point used for NatSec calculations and GDP. Its a top down model, and the general population is not at the top, just a data set.
Eliminate social security and medicare and you may not need any immigrants. The reason neither party fixes the border or immigration is because everyone knows they are needed to fix this mess.
I suspect in a year or two there will be a huge “amnesty” program the way Regan did in 80s and give everyone work authorization. Presto a whole new flow of taxes!
The “border” is a great gimmick to get suckers to send in their political campaign donations to “fix” the mess they have refused to fix for 40 years but this time it’s for real…lol.
I paid in to social security. Cold dead hands, etc.
Your deductions went to retirees at the time, there isn’t a trust with “Patrick” on it. MPO’s money could theoretically go to you, but isn’t fair to MPO now, is it? When something is widely known to be a pyramid scheme it is a tough sell to those who aren’t receiving.
But his cold dead hands didn’t have a choice for the last 40 years. His comment is that he might not sit idly by when the confiscatory program changes when it’s finally his turn to receive funds. We can discuss this by being technocrats and parsing the language of this technically being a designed ponzi scheme but when, say, $24,000 is removed from his “promised” income stream you can understand what those cold dead hands will be holding, right?
e.g. they recently changed the rules of IRA beneficiaries where planners like me saved as a means to pass money to future generations that could strech the payment of taxes over their lifetime, now reduced to 10 years. That was a huge blow to those of us who followed the rules for 20 years, suddenly changed.
So, we realize things change. However, they didn’t confiscate one dollar of mine, my heirs will still receive it but have to better manage the taxes, which I deferred anyway.
Let’s play your game and confiscate social security on technical grounds that it didn’t say “Patrick” on it. I don’t think people realize how armed the U.S. is or what folks will do if you removed their main source of income when they are too old to re-earn it but not too old to put 5 pounds of pressure on a trigger.
Hence, Patrick’s comment, rhetorical as it was…until it isn’t.
Social Security is not really in danger of going broke anyway, as it’s about 80% funded. That’s fixable with changes in taxation. What is not fixable is Medicare/Medicaid, which is now over a trillion in the hole and about 15% funded. You’d need a fivefold tax increase to even begin plugging it. When that blows up it is going to be one nasty show.
‘Patrick’ may feel duped if they didn’t know how the system functioned during their working days, they may be fearful because they can’t sustain themself without the monthly stipend, they may not care that the percentage contribution by MPO is significantly greater than when S.S. started (thus the system is less fair than it used to be). The initial tax rate was 2%, but the combined rate has exceeded 12% for the past 30 years!
Your personal anecdote is non sequiter, as the money you set aside was in a personal account for a specified purpose. My point was that isn’t how the S.S. system was created or functions today. Like Patrick, you did have dollars confiscated to fund the S.S. system, but you were affluent enough to have extra to set aside in an IRA.
I’m not playing a game of technicalities. It is known by some that the first recipient of social security payments (Ida May Fuller) wildly exceeded her contribution to the system. The extreme outlier, but she is not alone in getting out more than she put in. The rate of contributors to retirees in the U.S. has been decreasing and the system is far from sustainable as it currently exists (less than 3:1 and dropping). Do you think it will come down to who cracks first – the young or the old?
You’re crazy if you think that anything close to a majority of the illegal invaders will be net contributors to the tax system. The U.S. is an extremely expensive place to live and the $15-20/hour service jobs that the illegals are qualified for aren’t going to make ends meet without government assistance, even crammed two or three families in each house. It could take generations for skill levels to improve, not to mention that so many “good” jobs are disappearing to offshoring, robots, and now, AI.
You are seriously misinformed.
link to wolfstreet.com
So a bunch of sub-Saharan Africans with an average IQ of 72 are going to build an EV battery factory, then work in it on an assembly line like Henry Ford and the Model T? Sure, buddy.
The 72 IQ people will be here long after your kind goes extinct so yes, they’ll be the ones to do it.
The meek shall inherit the earth and fools inherit the wind.
Those places are only going to employ a few people. Most of it will be robotic assembly lines.
Even if this boom creates 50K manufacturing jobs across the whole US that’s not enough middle class jobs to sustain a tax base or even make a dent in the jobs required for all these illegals.
There is literally nothing for them to do. We already import thousands of legal cheap workers every year from Mexico on temporary work visas to work in the fields. We can extend that to hotel maids I suppose but how many of those do you think we need?
The jobs that need to be replaced as boomers and then Xers age out require actual skills, degrees, language etc. Those illegals have none of those skills and never will get them. Their kids might get them but that’s a whole other generation from now and why do we want to spend money on their parents who will contribute nothing.
Great post. I always say that if a company needs to hire someone, they accept applications, do interviews, etc. to select the best candidate.
You don’t hire someone who sneaks past the security guard in your office building and storms into your office demanding “You don’t know anything about me, but I’m really poor so give me a job.”
If we truly need workers to replace an aging population or one that’s not reproducing quickly enough, we should have the pick of the litter from abroad. As it stands, we’re getting crapped all over with the dregs of these third-world countries.
Latin America is emptying their jails into northern Mexico.
JOLTS report says there are 9 million jobs open Tim and that number hasn’t gone down since it went up except for a few blips. There is plenty to do. If they don’t have the right skills, then someone will have to pay to train them or you and everyone else will be dealing with very high inflation as there is a bidding war for people with skills.
There are 500,000 projected jobs to be open in construction industry alone by 2030. Go google it. There are shortages of police, pilots, mechanics, nurses and anything else you can name except retired boomers, we have plenty of those.
link to bls.gov
If there are really 9 million jobs open then why don’t we first start filling them up with the people on welfare. After all, if companies are going to have to train someone then start training actual citizens who are on welfare so they can become productive.
In other words why import illegals when we have millions of potential workers here now on welfare.
And we’re gonna fill it with unvetted folks just crossing with no information as to what skills they have or what they are capable of learning?
I understand your point but then you make a targeted immigration plan. I worked with the Indian workforce with technical skills and they, despite known and clear weaknesses, are a capable workforce in a managed visa program to ensure we have the skilled workers. Your approach–let millions flow across and gosh darn it it’ll all just work itself out. Except they need to be “shovel ready” on day 1 for your concept to work. It only works in theory and it’s not working in practice now for, if it did, 10+million would already be “police, pilots, mechanics, nurses and anything else I can name”. So Colonel Jessup, why the 2 views. Either we have 10 million already here and we don’t have a shortage or we have a shortage because the 10 million were just benefit-seeking refugees who aren’t fixing our shortages but in fact currently exacerbating it.
it’s the difference between your idea being possible in theory vs how it’s happening in reality.
Just go to a big city E.R., one I’ve been in 4 times in 2 months with my brother having fungal pneumonia. It’s not isolated, it’s happening.
Get your head out of the jolts number because those millions already here should have filled your shortages but, gosh darn it, they don’t speak the language, they aren’t pilots, they aren’t nurses, and they aren’t doctors. They might be someday but, if we want to solve the shortage you describe, we can do so by targeting entry into the U.S. through legal means, right?
Whoa. Who said this was my approach? Who says I want any of this happening? There is reality and then the fantasy world a lot of people here live in.
Two simple facts:
Now what’s the solution?
Who is going to execute that solution?
When is it going to happen?
Anyone waiting for politicians is to solve this is foolish.
One factor at play is the reduction and then the flatlining of annual Social Security Surpluses that everyone in Congress was well aware of. It was never addressed in either the Bush II tax cuts nor the Trump 1 tax cuts or in establishing long term fiscal policy. The flat lining of these structural surpluses started during the Obama presidency and is solely attributed to demographics. It does not account for all the increases in the deficit but it plays a material role. SS had structural surpluses for about 30 years give or take since the reform under President Reagan (SS tax hikes). When SS runs structural surpluses, the excess dollars flow to the Treasury for current account use. The surplus dollars thus reduce/off-set the amount of public debt issuance. When SS does not produce structural surpluses, the following happens: a) Treasury dollar inflows fall b) public debt issuance increases c) Treasury has to issue public debt to cover SS Trust Fund redemptions c) interest on public debt rises. It’s certainly not the whole explanation but in dollar terms, I would say it’s between 15-20% of the picture as far as accumulated deficits are concerned. Federal Trust Fund Accounting 101: wonky but with big implications over time. This is why I say that any SS reform has to start with a basic framework: one that has SS having structural surpluses and one that does not. Policy looks very different for both outcomes.
Great comment and 100% accurate. The problem is the Democrats would fix the structural deficit by raising taxes which the Republican would never allow. And the Republicans would fix the structural deficit by cutting benefits which the population will never allow (which is why they never actually propose anything, just talk). The solution will have to be some of both, which requires a level of courage that no longer exists in our political class.
My only problem with what you wrote is this:
“When SS runs structural surpluses, the excess dollars flow to the Treasury for current account use. The surplus dollars thus reduce/off-set the amount of public debt issuance.”
This in effect just hides budget deficits by using excess SS to pay for for the deficit now which then causes SS deficits (and larger government deficits) in the future. In theory SS should be a net zero every year to prevent current administrations from using today’s SS surplus to hide their deficits.
So 30 surplus years were actually contributing to today’s faster growing deficits because it allowed those governments to over spend and create entitlements because it appeared the deficit for those wasn’t ‘that bad’. Fast forward to today and the bill is coming due and we can’t afford those same things and in fact we couldn’t afford them then either.
“….This in effect just hides budget deficits by using excess SS to pay for for the deficit now which then causes SS deficits (and larger government deficits) in the future….”
👆👆👆👆👆👆👍👍👍👍👍👍👍
This….
Rob Peter to fund Paul’s largess. And that’s not an endorsement of SSI, just stating how the grift works.
To be clear, what I wrote is not an opinion. It is how federal trust fund accounting works. Trust fund surpluses are “borrowed” by the Treasury and spent. The Treasury then issues a credit to the Trust Fund agency. Some call it an I.O.U., some all it a “special purpose obligation bond.” What it is is “intergovernmental” debt: debt that one federal agency owes to another. If is not public debt as no marketable
Treasury bonds are issued. In short, it’s a credit entry plus interest. I have said before that the Clinton era balanced budget for several fiscal years were a myth. What you had was several years of structural “on budget” deficits but Treasury did not have to issue real public debt. Why? Social Security surpluses provided cover.
It was LBJ that created the Unified Budget by merging Social Security with the General Account. He did that to hide the cost of the Vietnam War.
Formally, an increase in the deficits did not increase interest rates. Inflation used to be the most important factor determining interest rates, operating through the supply of, and demand for, loan funds. Rising rates, in the company of a deceleration in the economy, is cause for concern.
You said it all, right up front, and hit the nail right on the head!!
“The following chart shows federal debt vs population growth. It’s a vivid reminder of the unwillingness of Congress and either party to put an end to unrestrained spending.”
Why on earth would Congress (either party), feel the need to do that? They are not expected to have a balanced budget. They are not expected to spend thriftily. They are not expected to spend on things we need, but rather what they feel, we need.
We all know this, because it’s how we all live in America, for the most part right?
What % of Households have a balanced budget?
What % of Households spend thriftily?
What % of Households place emphasis on what’s needed and not wanted?
The answer, unfortunately, is not all that many. If we did, we wouldn’t be in the current situation we are in as a Country, now would we? We would also expect a whole lot more from our leaders, if we expected a whole lot more from Ourselves…
We are taught, right from the start, to ask and you shall receive (think Mom & Dad). We are taught, right from the start, to expect certain things, that are meaningless to life (think instant gratification items). Family value has changed to what’s in it for me, or I’m not helping out, I’m too busy. Go, go, go…
The value of something, has become its monetary value. That is warped in theory, but practiced throughout. Sad!
Excellent post Mish. What the chart doesn’t show however is that it just isn’t the small growth of population and the high growth of debt. The fact that the population is aging and we’ll soon have 40% of the population dependent on the remaining 60% is unsustainable. Even if we wanted everyone to get back to work to pay off the debt it can’t happen, people are too old and too sick. I don’t see how robots or AI will fix this either unless robots get paid wages, pay social security / medicare tax and income taxes.
I already have $1000/month taken out of my paycheck to support social security and medicare. I then have more money to pay for healthcare insurance not just for me but all the uninsured people out there. And let’s be honest, the vast majority of healthcare is being used by seniors. I rarely go to the doctor for anything but when I do, I pay through the roof because I’m subsidizing everyone else.
And the general response here from commenters is, “don’t worry someday you’ll get to screw others out of their money” isn’t a viable solution.
Now add having to pay for utilities, food (SNAP), medicaid, and all the other goodies people have become dependent on and it all becomes insurmountable. And the socialists scream for more taxes and lifting the caps on SS.
I was just on a cruise and I have to say the obesity epidemic and all of its implications on the old and not so old is out of control, growing worse, and is largely the trigger for Type II diabetes, other circulatory and respiratory diseases and most likely is a factor in the relatively high Covid related death rates in the U.S. A chunk of this trend is reversible but it requires leadership, policy incentives, nutrition guidance. It’s sad because the obesity epidemic is trending younger.
The solution is obvious, even bigger tax cuts for wealthy campaign donors.
Eventually one can no more defy the laws of economics than the laws of physics. Eventually it all comes home to roost in one form or another. And none of it is good. That I can assure you.
Getting the timing right when that happens is where generational fortunes are made.
So now that we all agree the debt is both untenable & unstoppable, the only question is, “when does this madness implode?
That is an excellent question. 2030 is when all the baby boomers hit 65. SS is supposed to be insolvent in 2034.
1929 is when the great depression started and some say it moves in 100 year cycles so that pushes it 2029.
And there is about 2 trillion in commercial real estate loans due this year and next.
In 2025 the Trump tax cuts expire so in 2026 taxes will go up. Credit card, student and auto loans already in the trillions. There will be less money to spend in 2026 because of higher taxes.
I suspect sometime between 2026 and 2034 is when it all falls apart with big cracks starting between now and then. The alternative is massive inflation which isn’t good either, especially those on fixed income.
How could it implode? If you had $10,000,000 in debt and could print $10,000,000 anytime you wanted, you honestly wouldn’t even have a noticeable problem.
Until Bond Sale time that is…
You seem to have forgotten how painful inflation can be
That’s an explosion, not an implosion.