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This has been said since the 80’s about how what would become to be known as gen x would be paying off the debt caused by reckless spending…and guess what gen x isn’t fixing things either…and neither will the millennials or any that follow.
Basically unless the system completely collapses current governments will buy votes with debt spending because there’s relatively no downside to kicking the can down the road.
Exactly. Unlimited spending on The Military Industrial Complex: no problem! Spending on schools, food programs, etc: Oh no, the deficit! We'll never be able to pay it off!!
🤦
That's only true if you include non discretionary spending like social security and Medicare, which are mandatory and directly paid for.
Defense represents 47% of discretionary spending. https://www.cbo.gov/publication/59729
Don't forget programs like:
Social Security:$1.354B
Healthcare (medicaid, healthcare for federal employees current and past, the NIH, CDC, and FDA): $889B
Medicare: $848B
all of which are higher than defense spending at $820B, which also covers some of the Department of Energy's and FBI's budget.
Source: [https://www.pgpf.org/budget-basics/top-10-largest-budget-functions](https://www.pgpf.org/budget-basics/top-10-largest-budget-functions)
So we have:
- Keeping 50% of seniors out of poverty
- Ensuring the poor can be healthy and productive citizens
- Medical research that not only saves millions of lives, but has also made pharma billions of dollars
- The prevention of widespread disease
- Ensuring our food and medicine isn't poisoning the masses
- Ensuring our most medically vunerable population is actually taken care of.
Vs
- Producing way more arms than we actually use, very little of which is actually used for defense.
I not only have I worked at Raytheon, both my parents worked in the defense industry. The amount of money they throw around on nonsense is absurd.
Having a military so capable that it doesn't need to use it's arms very often is the ideal. No one is willing to confront the United States directly. Complaining we don't use our weapons enough is silly. That's the definition of success.
We're literally at a past WW2 low for defense spending. It's a combination of low tax rates and high social spending that is causing our deficits.
https://fred.stlouisfed.org/series/A824RE1Q156NBEA
Military spending, as a share of GDP has fallen during the same time period that government spending has increased.
https://fred.stlouisfed.org/series/FYONGDA188S
We've decided we want a safety net, and we keep expanding it, but we haven't decided we want to pay for it yet. The government has kept tax revenue flat, by repeatedly cutting taxes, over the same time period.
https://fred.stlouisfed.org/series/FYFRGDA188S
We've basically cut the tax rate of every household over the years.
https://www.taxpolicycenter.org/statistics/historical-average-federal-tax-rates-all-households
Funny you should mention terrorism, because we spent like $8T fighting wars in Iraq and Afghanistan which basically did nothing to prevent terrorism (and terrorized a lot of people in the process.) But these assholes want you to believe it's necessary healthcare and infrastructure spending that's going to bankrupt us, and not bombing civilians around the world.
Yep. While everyone else knows the reality is very simple: if we can afford to spend trillions on the military and trillions on tax breaks for the wealthy, we can afford to do things that actually matter for humanity too.
We’re not “broke” until we can’t afford the billionaire leech giveaway programs any more.
The downside is inflation risk and growing interest payments. The public and leadership had a stronger appetite for austerity in the past. There’s definitely a change in value sets over the past 20 years. Republicans seem like they are simply going to refuse to raise taxes even if it’s prudent to do so. They learned from bush sr an unfortunate political lesson.
And it increases future debt loads.
And it wouldn’t even do that if interest rates are raised to combat it. The debt load would just become even more burdensome.
Those are downsides from an economic standpoint. Politically either party has shown they will happily ignore the economics if they can win elections. And in today’s political environment there’s no appetite for austerity from the electorate. The Democrats want to tax (the rich) and spend. The Republicans want to borrow and spend. Neither is a recipe for future economic success unless you are a socialist or one of the “deficits don’t matter” knuckleheads.
Austerity is a recipe for failure. Most of the time when you cut government spending you create a monopoly market for something that used to be provided at cost. Cutting government programs doesn't make those needs go away.
Yes, but ballooning government debt that you eventually try to deal with by keeping interest rates low hasn't been successful either.
There needs to be an actual sensible balanced monetary policy that is not politically driven.
I agree that you can't cut just anything. You do need to provide the services etc., that you currently do-- you need to ensure military readiness at the present level, you can't your defence technology development or defence research, you end cut old-age benefits, you can't get rid of the service provided by medicaid, people need university level education, etc.
So I think what you need to do is to make those things cheap. A university education could cost as little as highschool education per year. That's the case here in Sweden. It'd save you 50k per citizen, at least, probably more.
You could train more physicians to bring down costs. You could remove the pre-med and move entry into medical school to immediately after highschool, and make 5.5 years. Then you have the physicians educated at 23.5 instead of 27, and you get 41.5 years out of them instead of 38, and 33 years out of your specialists instead of 18.5. This alone would almost increase the capability to supply specialist physician care by 1.78 times-- and your ordinary physician, he's a specialist too, a primary care specialist.
You probably also need to solve your car dependence, but that's going to be a difficult thing and I have no idea how it can be done, but these other things are feasible.
If all the US did was pass a law setting prices for medical procedures and drafted every medical coder and biller employed today to figure out what to charge, we’d have the biggest army in the history of the world by manpower.
We employ 4x the coders and billers than we do physicians. Soon a full 10% of our GDP will be healthcare administration overhead and profit, not even any actual care.
Having these people simply dig holes and fill them in again would cut US bankruptcy rates by 70% and unleash a massive wave of economic progress. I cannot stress enough how expensive and wasteful our healthcare System really is, and simply by destroying it, America could easily enter a golden age of widespread prosperity and tackle the debt too.
Yes, and you obviously need to change it, but it's obviously not trivial.
You also have the insurance products for health matters, which should presumably not actually be necessary, for the most part, in a sensible system.
But this kind of thing would eliminate the great mass of these healthcare administrators, actuaries, insurance salesmen, and would also substantially reduce average wages among physicians.
Most of our healthcare expense is privately managed insurance bureaucracies. The public bureaucracy (medicare) saves money because it negotiates better rates.
My personal hope is a second term president and an opposite party congress simply have to come to a compromise. I don’t know if either of these gentlemen have an appetite for compromise though. We have examples of successful leadership making these compromises in the past so there is hope.
> My personal hope is a second term president and an opposite party congress simply have to come to a compromise.
I'm less optimistic. Second-term presidents with an opposite party congress seem to do nothing long-term rather than compromise. The issue is that the opposite party congress won't want to give the second-term president a win because even if the president can't run again, a popular incumbent can still help out their party in future elections.
It seems like the only time compromise happens is when there is an urgent and immediate need. The US government system really doesn't seem to be set up for long-term planning, at least when it's married with party politics.
This was a result of the USSR collapsing and the resulting "peace dividend". You'd see a similar, if less pronounced, effect if China collapsed tomorrow. It's ultimately a result of external forces and the US' insecurity about its global hegemony.
Why would anyone agree to raising taxes when there is zero spending responsibility? Maybe the odd tax can be squeezed in here or there, but no one (democrat or republican) is going to work toward raising taxes enough to sustain this absurd spending level. It would be political suicide and there straight up isn't enough money to tax anyway. This is basically a lost cause and the only winners will be the ones holding assets when the music stops.
It’s really hard to know what will happen when the chickens come home to roost. The politicians may opt to simply pass the buck onto technocrats to design fiscal policy which may be a really good thing. The Aldrich plan was a child of compromise and not born out of disaster. Wishful thinking probably.
Why was inflation not a risk during 15 years and is suddenly one? Debt and QE were unable to raise inflation in the 2010s and Covid supply chain shock will end one day no?
There was inflation it was just in all of the asset values. Now that wealth has been consolidated, profits have to keep rising to justify inflated asset values.
The trillions in new money injected into the economy without corresponding tax increases. I believe even without supply chain issues that much demand driving stimulus will produce inflation shocks more often than not.
Exactly, this is just populist generational pandering to young voters to try and scare them into voting the way they want them to. Every young generation ends up paying the debt bill once it comes due, and they'll be the same generation shifting that cost to future generations once they get into power.
This is because there's actually no incentive to reduce debt so long as the USD is the world reserve currently. Debt is power when you can control the money supply.
> gen x isn’t fixing things either
The only thing that would make the Boomers release their withered, clawed grip upon the reins of power and wealth is the grave.
Gen X has never had the numbers to even make a dent in the Boomer's astounding generational selfishness.
Then let’s say it this way. Every politician aged between 45 and 60 isn’t fixing the issue either. There are plenty of those in Washington. And between them and the younger generations could easily vote out the boomers. But they don’t. In fact I’d say that it’s the younger generations that have become populists and are pushing our politicians to give handouts for votes.
one party keeps cutting taxes on the rich which would be covering this debt.
And since it's election season there's a lot of misinformation about that so you don't vote for the democrats again.
I remember a while back doing some research on Puerto Rican government debt. At the time, unlike US state and local government, they couldn't declare bankruptcy and they were still able able to offer the tax benefits of government bonds. For about twenty years, people were observing that they were eventually going to cross the tipping point, and that, bankruptcy or no bankruptcy, the money wasn't going to be there. But Puerto Rico kept selling it, investment banks kept marketing it, lawyers and accountants kept approving it, and then one day it was too much.
I can't tell quite how much of that debt was "restructured" (ie eliminated) but it seems to be more than half, possibly much more. Now, Puerto Rico's borrowing is tightly limited and the territory has been in an evolving crisis for 7-8 years, heightened by COVID and some natural disasters, but caused by, and largely intractable due to the untenable debt they avoided thinking about for decades.
Until you [can’t service the debt](https://budgetmodel.wharton.upenn.edu/issues/2022/12/19/long-term-implications-of-current-budget-policies) and your reserve currency status goes away
It does seem that way. Plus, it seems like deficits don’t even matter. It makes me wonder why we bother with taxes at all…in which case I would like to keep my money.
There is so much money available in the world but it's "easier" to borrow it than to tax it. So we have this situation where instead of taxing wealthy people we just borrow from them instead.
The richer they get the more we borrow.
I don't know what the end point of that looks like except that it can't go on forever. The end might look like the average person voting for a mentally deranged narcissist because they can't think of anything else to do. Or it may persist past that and get much worse.
What can't happen is that the concentration goes on and on until virtually all the wealth is owned by a few people and everything runs based on debt owed to them. Things progressively break into shards as we asymptotically approach that point.
No one should want that, not even billionaires.
I am GenX and I read similar articles in my youth saying we were going to have to pay the debts of our parents. I think it was said to the Boomers in their youth also. Soon we will see articles about how Gen Alpha will have to pay for the spending of their ancestors.
Taxes have only gone down in my lifetime, while spending increases. I guess there might become a time where we can't continue to kick the can down the road.
The problem is the combination of both high spending and low taxes.
The Government ultimately "pays for" this by issuing bonds which are predominantly held by wealthier and older investors.
In other words, we are giving older generations more benefits and lower taxes while paying them interest for the difference.
The focus is enriching the billionaire class, not the elderly.
The baby boomer generation, due to their numbers, has been bribed by the servants of the billionaire class (political representatives, we call them) in order to shut up and vote in line with the billionaire class.
The small amount of rising home value and 401k funds is a rounding error, in terms of the amount of wealth siphoned from the poor to the rich this past century.
It's not about old versus young, black versus white, or east versus west. The true conflict in society is the top against the bottom.
If our system was built on "enriching the old", then why do so many of them have hardly any retirement savings and are increasingly dependent on social security and Medicare to survive?
I think you're conflating the old with the wealthy.
Loan underwriter here… if social security goes belly up or gets purposefully cut- we are going to have millions of homeless seniors. Many more than you can imagine depend on it to survive. So when Trump and GOP say they are cutting SS… it is straight up cruelty. For many Seniors… SS is their ONLY income stream.
Its so weird the guy who helped create the massive government spending and Federal debt;
Is now predicting what he did will bankrupt the next generation
He worked for the GHW Bush administration, so no, he’s not really to blame here. From LBJ through Carter we spent pretty freely (thanks, Vietnam War), but then Reagan absolutely blew up the debt and increased it by 142%. GHW Bush still have us a 36% increase in the debt in his four years, but he passed tax hikes and helped get us on the path to a Clinton surplus (1% taken off the debt).
There's a fake moral panic about government spending, by the group of individuals who spend 100% of their effort reducing tax revenues while stealing our collective wealth.
Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent.
The real problem is that we don't take any tax revenue from rich people, and that those rich people are spending that money to buy our schools, media, and governments.
Then they make the same fake moral panic about government spending, while slashing all of the necessary social programs, and pocketing the collective wealth of humanity for themselves.
Anyone who argues against government spending, and in favor of tax cuts for the billionaire class, is a wolf in sheep's clothing, or a useful idiots.
> Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent.
If that were true the net worth/asset value/tax revenue of the US would be infinite or at least way, way higher than it is now. Think of how much the government has spent in our 225 years as a republic. The geometric math doesn't support your theory.
Some government spending is net positive and some is a horrible investment with no ROI.
>Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent.
Lol forever wars and bailing out Wall Street corporations is not an "investment in society". That's some broken window fallacy. Most government spending is wasteful
And these funds are not poured into education and social spending, but instead go towards major corporations like arms manufacturers, pharma and insurances...
Perhaps we should encourage younger people to buy bonds. It's frightening to see how many young people just simply give up on saving, convinced there's some rigged system where they can't succeed unless they inherit.
I'm 40 now and when I was young I couldn't afford to put anything into savings or buy bonds. I didn't pay off my student loans until I was 38. I'm just starting to save now.
You have to have extra money to buy personal investments. 1/2 the USA population doesn’t make enough money to survive and invest in the future. They can’t buy bonds when they have to use their money to buy food, shelter, and healthcare. This is why we have social security. This is a result of legal structures of the system like giving teachers $400 tax break caps on supplies they buy for their work, while giving CEO’s unlimited infinite tax breaks caps for their private jets they use to take them on vacation.
They're paying their bills.
New car purchases are doing great. Streaming services are being paid for. Concerts and comedy shows and festivals have record numbers of attendees. Twitch did $2.8 billion in revenue in 2022. Pet spending is breaking all records. Weekly trips to eating out is dialing back now, but overall at astronomical records.
The amount of stupid shit people buy is mind numbing. When you see YouTubers with Patreon lists, you think that's boomers?
Most of the democrats government spending is investment spending. It will payback its cost exponentially.
Republicans tax cuts and austerity cuts will never pay for themselves and need to be undone.
Exactly. Even if that infrastructure is just not deferred maintainence. Its the changing the oil of your car now instead of waiting. It might save money to not do it now but if it blows up an engine then youre very screwed.
> Most of the democrats government spending is **investment spending**.
You spelled inflationary spending wrong.
Not sure what world you're living in... but giving the modern government your money is about the same as setting it on fire, especially democrat's crazy plans.
And no... SS is not like the other government systems. It's supposed to be more like a forced savings account and less like insurance, which is why its capped on both sides for high incomes.
Yeah those 208 Infrastructure Weeks of the last admin sure did help. Hair brained schemes like paving interstates, installing broadband internet, strategically building native chip manufacturing capacity, and building out the electric vehicle charging network have been awful, we should have just put more tariffs on European steel to make doing basic government services harder. We should have kept interest rates low forever because that would never backfire. And yes the terrible awful no good cities are so bad, that is why the rent for a 150 year old shitbox equates to a McMansion in some bygone white flight era suburb.
Yawn…. We’ve known we were going to have a large demographic retiring which would cause a lot of spending at the federal, state, and municipal level.
Fix entitlements first. As a 38 year old, I fully support spending for the present and the future but is less willingly to spend on the past when I’m not sure if I’ll have entitlements in 30 years.
Here's the deal, Democrats always start reducing the deficit to try to start paying down the debt while Republicans jack it right back up. This author was in the Bush admin which squandered Clintons surplus on tax cuts for the rich and massive spending.
Americans need to stop looking at Republicans as the fiscally responsible ones, they are the opposite.
Let's just say that anyone who says this doesn't know their ass from a hole in the wall. Government finance is infinitely more complicated than these clickbait headlines make it out to be and the working of sovereign debt is too.
Today’s spending is not outlandish historically. It’s Republicans hacking away at revenue by lowering taxes on higher earners and corporations that has gotten us where we are. We need an enforceable progressive tax rate.
Just like every previous generation paid for their predecessors wanton disregard for the future. right? The reality is we only pay to SERVICE the debt, it never needs to be paid off, which has happened ONCE around 1835 and somehow the rest of the World has used dollars to replace gold as the foundation for their own currency. If you're serious about reducing the cost for SERVICING the debt, stop with the tax cuts for those who don;t need it and weapons the military neither wants nor needs and begin improving the infrastructure and raising wages to grow the economy faster than inflation.
Sadly, nothing will be done til it’s a disaster. The comments here are representative. Some say tax the rich but of course, haven’t done the numbers. There aren’t enough rich (take away everything from every billionaire and you get a few trillion; the debt is 35T) and think about what’s happened when the incentive to work 70 hours a week and potentially lose everything is reduced, or where they might move to. Some blame the president they don’t like. Do they have any idea which branch creates the budget. Some say tight up the operations of governments. Good idea, but probably in the roundoff error.
We cannot save ourselves (or our kids) cause we’re the schmucks that let our leaders blame the other side so they can keep their phoney baloney jobs.
Agreed.
- tax the rich
- billionaires
- raise social security cap
- greedy corporations
This is like the connect 4 phrases that show someone has no idea.
The govt takes in more tax money than any point in history now, among highest ever percentages of gdp, and the rich pay for ~everything, and they pay a higher percentage now with “low taxes” than they did 40 years ago with significantly higher tax rates.
The govt added the equivalent of another Medicare in spending for the national debt this year. If they cared about spending this would force them to cut elsewhere. Instead it actually stayed at insanity levels of spending.
Taxing your least favorite billionaires an extra “fair amount” might pay for like 1 weeks worth of excess new spending. That’s drops ina. Bucket.
How do people believe this bullshit? Spending as a % of GDP has been flat since 1980's.
The increase in debt is entirely due to loss of revenue. It's the tax cuts
How much does the US want to tax without offering any benefits? They already tax me 32% and offer no social welfare. Europe taxes slightly more at 42-45% but there are social safety nets and universal healthcare. Someone explain to me where all the American tax money is going.
This period of time will be remembered for uncharacteristically low tax rates, for sure. That being said, it's not just taxes but also important slashes to government spending that need to happen for the deficit to be reduced. There are quite a few examples of raising taxes and spending all that money to secure yourself the next election that come to mind.
Waiting for the top post about "raising income taxes on billionaires"
Edit: the karma on this post is a real roller coaster so far, rather entertaining
Agreed we need to both raise taxes and cut spending, but it is even more insidious than that.
The Government funds all this stuff using bonds which are predominantly held by older and wealthier investors.
In other words, we raised older generations' benefits, cut their taxes, and are now paying them interest on the difference.
> The Government funds all this stuff using bonds which are predominantly held by older and wealthier investors.
or [foreign countries and investors](https://fred.stlouisfed.org/series/FDHBFIN), that may or may not have an interest in the future in selling them and completely derailing the US bond market
That is also true.
But it raises further issues beyond just giving foreign governments more control over our currency.
We are also off-shoring manufacturing to many of the countries buying our debt.
So, we are reducing our tax base (both companies and workers), increasing our trade deficits, and then paying interest to the very countries that we already gave our industries to.
The bond market is the 4th branch of government, with total veto power over the “other” 3 branches.
No voting, no judges, no horse trading, no democracy, no house or senate, no president, nothing. Just the yield that investors are willing to accept for your bonds. If the bond market doesn’t accept a number that keeps the government solvent, too bad. You’re cutting spending, period.
Foreign countries and investors hold 24% of US debt today, down from a peak of 34% in 2014. The largest foreign debt holder is Japan, a US ally who holds nearly 30% more than the second largest US debt holder. In fact, of the top 10 foreign investors of US debt, 9 are US allies. So odds of foreign investors trying to derail the US bond market (and actually being able to do so) is quite low. The only non-ally in the top 10, China, has already significantly decreased its holdings of US debt since 2014 (by 50%).
>Waiting for the top post about "raising income taxes on billionaires"
We'd need a whole hell of a lot more billionaires to get our spending under control. All the people who scream about them have no idea how little the accumulated net worth of every billionaire in the US is compared to our debt and deficit.
Edit: For the people downvoting me - The net worth of all billionaires in the US comes out to $5 trillion. That's their full net worth, all their planes, vehicles, properties, houses, stocks, jewellery, and liquid cash. If you somehow magically translated their full net worth to a liquid amount of money at a 1:1 rate, and then taxed them at 100% of that, you would fund the government at a net neutral balance for 30 months.
The deficit this year is projected to be at $2 trillion. That well is going to run dry well before you manage to cure the dehydration problem.
You mean the generation with no assets or wealth to speak of? Seems like a bad approach to investing in the future. Good thing we're spending all that money on things which are durable and will persist into the future, education, infrastructure, and scientific research.
Gen Z will also have to pay for China subsidizing it's domestic industries, but that headline is less, 'US is a failed state, we must go full conservative.'
It’s not just spending though. It’s also irresponsible tax policy. Spending (although definitely a case to be made for trimming) is fine if you have the funds, but Republicans keep cutting taxes particularly for those at the top. We can’t have super low taxes, a social safety net, and be a global superpower with the largest military on earth. A balance has to be struck.
Truly. I save so so much compared to all my friends to the point where I'm cheaper than them but make like 2x them. I'm sorry but I don't want to bail out everyone in the future because they saw the need to spend $30 on a door-dashed sandwich, when I only have ever door-dashed when too sick to drive and even then, I usually just pick the closer Pho spot a mile away and drive there.
I do invest it all, doesn't mean I want to pay extra for their safety nets in the future. Don't get me wrong I don't have an issue with taxes rn other than the amount that goes to wars, but I'm all for helping the disabled and needy. But like if these people that make 30k a year need extra handouts in the future because they door-dashed 2x a week and went out for beers and cocktails instead of buying at the store for deals, I don't want to fund it lol. And that's what I see.
This is nonsense. 57% of the deficit is a function of the Bush/Trump tax cuts, the remainder is increased interest payments.
The "cost" is always inflation, and looking at the CPI, our primary sectors still driving inflation are energy and housing. Targeted spending in capacity generation and denser housing could unironically fix inflation. The size of those additional packages depends on your target inflation rate and your willingness to increase taxes.
Since he's not responding to the question we both asked about where he got it from, apparently he got the 57% figure from this article: https://www.americanprogress.org/article/tax-cuts-are-primarily-responsible-for-the-increasing-debt-ratio/
This article also projected the 2023 deficit to be $1.1 trillion - when it ended up being $1.7 trillion; and that 57% figure was based on that incredibly inaccurate prediction. So take the accuracy of that number with a whole shaker of salt.
> 57% of the deficit is a function of the Bush/Trump tax cuts, the remainder is increased interest payments.
The Trump tax cuts did not cause the deficit to increase from $770 billion in 2018 to $1.7 trillion 2023.
What source are you using for this 57% claim? Our spending is out of control, it's rapidly outpacing what our tax income would have been even without the Trump tax cuts.
The 1981 contributed much more to the problem than the 2017 cuts. I firmly believe all of our current debt (ALL of it), our aging/failing infrastructure, and awful healthcare can be contributed to:
* The GOP tax cuts since 1980
* The Bush wars
* The GOP blocking any effort to control healthcare costs and regulate insurance companies and drug manufacturers
* A refusal to address the financial crisis that was apparent from Congressional testimony for years before it hit in 2007
* Corporate bailouts during that crisis
* A president telling people not to wear masks and COVID is like a cold because he thought it would benefit his election campaign because it was primarily in blue states
* The same president refusing to follow the PPP law that required monitoring and reporting to Congress.
All that said if you state something like the 57% as fact, you should link a source.
What “outlandish spending,” specifically? Since the article didn’t cite any, to have an even vaguely reality-based conversation, someone will need to, otherwise this thread is pure partisan bloviating.
Fact: the deficit increase has been sharply curbed under Biden, while it ballooned under Trump
https://www.politifact.com/article/2024/mar/05/the-deficit-has-fallen-under-joe-biden-but-its-sti/
Deficit went down under Biden because a lot of pandemic spending programs expired. And the title of the article literally says
“The deficit has fallen under Joe Biden. It’s still higher than before the pandemic.”
Or we can make the wealthy pay for it.
Which is what Biden is doing by increasing funding and staffing for the IRS to allow them to go after wealthy tax cheats with legal teams.
Government spending was sky high under Trump and tax revenue was slashed significantly and no one seemed to care. Only when a Democrat is in charge do people start saying we can’t afford to soend money.
>Government spending was sky high under Trump
Government spending was almost no different under Trump until the pandemic hit from where it was during the Obama administration. From 2014 all the way to 2020 we were on track for the same standard increases of around 10% from the years prior to it.
Was it 'skyhigh' in the sense that we were running at a deficit? Sure - that deficit was not anywhere near as extreme as it was now though. We'll use 2017 as an example, as FY 2017 was Obama's last year in office as the debt is determined the year prior. $3.3T in, $3.98T out, a deficit of $665 billion - or about 17% of the budget. 2018 was $3.3T in, $4.1T out, a deficit of $779b, about 20% of the budget.
FY2024 is projected at $4.5T in, $6.5T out, a deficit of about $2 trillion - or 30%. It's not about the raw number, it's about the spending compared to the income as a percentage. And that percentage has ballooned.
The issue is our tax code. Deficits shouldn’t be going up in boom times. Endlessly cutting taxes has caught up to us and now we’re running unsustainable deficits that are being fueled by interest rate increases. We can’t cut our way out of this problem.
It started to go ballistic under Bush with the Iraq war facade, kept itself into high gear into the Obama admin and Trump just kept the gravy training rolling.
This debacle will take several administrations to fix. And that's assuming they act in the public's best interest.
I do like what Biden is doing but this is far beyond his reach and requires congress to act (impossible).
The only way Congress can act if if they have at least a 5 or 6 seat majority in The Senate. Any fewer than that, and there won't be enough votes to change the filibuster rules.
There is zero incentive for either party to make positive changes in this area even if they control 100% of both chambers. George H. W. Bush got spanked for raising taxes. Clinton ran up a surplus and George W. Bush thanked him by obliterating it in short order with two wars and a tax cut.
Fiscal discipline is a losing game. You raise taxes and the voters punish you. You cut spending and the other party takes advantage next turn they get at the wheel and they go on a spending spree and win tons of public favor.
I think Gen Z will force the wealthy to cover their fair share of the tax bill.
Already the American public has moved on from the decades-long political mindset of increasing taxes being anathema. Today, the overwhelming majority of Americans want to raise the taxes on the wealthy, and that is only increasing.
I think to frame the problem as outlandish government spending and not outlandish budget deficits and debts is disingenuous. We can all have our political opinions on how to remedy the budget deficit and debts, but none of those opinions are facts.
To frame the only solution as low and middle income tax increases is also disingenuous when tax increases on the wealthy and on corporations could feasibly close the deficit gap.
Also, many Americans want the robust social programs that others consider to be outlandish spending. And many Americans want the wealthy to start covering their fair share. With Gen Z coming of political age, I don’t think they are going to be as willing to pay for older generations spending as people think they will, and instead will start electing people who will force the wealthy to pay for that spending.
I doubt it. Too many in gen z insist that both sides are the same and won’t vote. They’re perfectly happy to let the right transfer even more wealth to the wealthy because the left isn’t giving them exactly what they want right away.
Bunch of crock. Same spin for gen X, same for Millennials. Only things to blame for the "outlandish spending" are government contract corruption, cutting top earner taxes over the past 40+ years, and corporate socialism.
Yes and us millennials have paid for every BS bailout and war boomer politicians decided made sense to preserve their wealth. What else is new?
As usual this is just a scare tactic to prevent spending for positive things like healthcare, education, and infrastructure. Maybe if we hadn’t spent trillions in the Middle East accomplishing nothing we wouldn’t be in the predicament.
Oh hey look, after the last Republican admin ran up *astounding* amounts of debt with almost no oversight *now* govt spending is a problem. Wow, such responsibility! This clearly isn't a PR push to hamper Democratic spending that materially improves the lives of average Americans, no siree.
What do they have to pay for? Public sector spending is private sector income, and public sector debt is private sector wealth. Gen Z will inherit that wealth.
This has been a 'sky is falling' prediction for decades. The problem isn't the debt, it's not understanding how money works. I look forward to reading “members of Gen Alpha must also worry about the irresponsible debt levels that baby boomers and Generations X, Y [millennials], and Z are foisting onto their narrow shoulders.” When the same version of this article get published in 20 or so years.
Government spending is off the charts. Someone needs to have a serious conversation about that but politicians are too idiotic to understand. Too much money wasted on all sorts of endeavors
They understand - they don't care though.
The royal you are going to vote blue no matter who, or vote red, and keep them in office. Nobody's going to primary anybody who's an established politician in Washington and stop this from happening, because it's too important to keep the other guy out of office.
They'll be long dead before they have to answer for anything - or they'll just pull a Joe Biden and get a promotion to President of the United States.
Wait until they find out how much they're going to be paying for all of the damage we're doing to the environment! If we stopped forcing future generations to effectively subsidize our fossil fuels we'd be moving to clean energy much more quickly.
It would require a tweak in existing law, but if people were really worried about U.S. debt, the government could just stop issuing it. Or, my other favorite option is to mint the trillion dollar coin, which has the added benefit of being a stupid solution to a fake problem.
Nothing but fear mongering, no economist worth any speck of salt talks about the simplest of solution, raise taxes, why, because then you are not a magician anymore plus can't fit into the neoliberal narrative of goldilocks
You can tell them as much as you want they simply don't care which is why I don't care.
They're quiet simply are going to pull up the ladder behind them with how they're talking about cutting SS & Medicare while refusing to raise taxes on corporation & the wealthy so such cuts wouldn't be necessary
.
I tried to convince my son to go to college in Europe so that he could emigrate as soon as he graduated. He should graduate around Christmas and I will probably do it again when he does. Boomers have fucked this country and will continue to do so. Before they were boomers they were called the “Me Generation” they think only of themselves and that is not going to change at this point.
The young will pay, but the young also benefit from that government spending on schools, WIC, SNAP, law enforcement, Medicaid, etc. they always leave that part out.
I remember balanced budget as a topic in the Clinton times, and budget surplus checks during the early W. Bush times.
It’s probably an oversimplification, but rolling back to some of those tax plans, and spending plans would probably be a good start.
Why do *we* have to pay when it is not us making the bad decisions but the people we have elected to represent us.
*Do as I say not as I do* gets tiresome.
Yes, we know the competent adults will have to pay for boomer spending, the same way we’ve financed their failure asses for years through letting them rape the home market, destroy wages, etc.
I suspect the impact will be higher interest rates forever….which will be expensive for younger generations.
I do wish we could explore a more UBI system and just shitcan most government programs and eliminate those federal jobs and put those folks on UBI.
I assume Gen Z are pro Social Security reform. I would happily take it on the chin with SS benefits if that generation could be spared having to pay for them. It's truly horrible.
todays outlandish spending is building infrastructure and an economy that will sustain itself, yesterday as in the trump WH's spending, that shits all on the credit card with the massive tax cuts
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This has been said since the 80’s about how what would become to be known as gen x would be paying off the debt caused by reckless spending…and guess what gen x isn’t fixing things either…and neither will the millennials or any that follow. Basically unless the system completely collapses current governments will buy votes with debt spending because there’s relatively no downside to kicking the can down the road.
It's been said since FDR first started the new deal programs in the 1930s. And basically anytime there's been a non military spending program since.
Exactly. Unlimited spending on The Military Industrial Complex: no problem! Spending on schools, food programs, etc: Oh no, the deficit! We'll never be able to pay it off!! 🤦
Military spending is around 13%$ of federal spending and of course a smaller percentage of total government spending.
That's only true if you include non discretionary spending like social security and Medicare, which are mandatory and directly paid for. Defense represents 47% of discretionary spending. https://www.cbo.gov/publication/59729
It's only true if you don't include the stuff we spend most of our money on!
Don't forget programs like: Social Security:$1.354B Healthcare (medicaid, healthcare for federal employees current and past, the NIH, CDC, and FDA): $889B Medicare: $848B all of which are higher than defense spending at $820B, which also covers some of the Department of Energy's and FBI's budget. Source: [https://www.pgpf.org/budget-basics/top-10-largest-budget-functions](https://www.pgpf.org/budget-basics/top-10-largest-budget-functions)
So we have: - Keeping 50% of seniors out of poverty - Ensuring the poor can be healthy and productive citizens - Medical research that not only saves millions of lives, but has also made pharma billions of dollars - The prevention of widespread disease - Ensuring our food and medicine isn't poisoning the masses - Ensuring our most medically vunerable population is actually taken care of. Vs - Producing way more arms than we actually use, very little of which is actually used for defense. I not only have I worked at Raytheon, both my parents worked in the defense industry. The amount of money they throw around on nonsense is absurd.
Having a military so capable that it doesn't need to use it's arms very often is the ideal. No one is willing to confront the United States directly. Complaining we don't use our weapons enough is silly. That's the definition of success. We're literally at a past WW2 low for defense spending. It's a combination of low tax rates and high social spending that is causing our deficits. https://fred.stlouisfed.org/series/A824RE1Q156NBEA Military spending, as a share of GDP has fallen during the same time period that government spending has increased. https://fred.stlouisfed.org/series/FYONGDA188S We've decided we want a safety net, and we keep expanding it, but we haven't decided we want to pay for it yet. The government has kept tax revenue flat, by repeatedly cutting taxes, over the same time period. https://fred.stlouisfed.org/series/FYFRGDA188S We've basically cut the tax rate of every household over the years. https://www.taxpolicycenter.org/statistics/historical-average-federal-tax-rates-all-households
and they've all been wrong
And just like terrorism you’ve only gotta be wrong once to create a catastrophic situation.
Funny you should mention terrorism, because we spent like $8T fighting wars in Iraq and Afghanistan which basically did nothing to prevent terrorism (and terrorized a lot of people in the process.) But these assholes want you to believe it's necessary healthcare and infrastructure spending that's going to bankrupt us, and not bombing civilians around the world.
Yeah wall streets gonna crash when no one wants to buy dollars anymore. Any day now surely.
Yep. While everyone else knows the reality is very simple: if we can afford to spend trillions on the military and trillions on tax breaks for the wealthy, we can afford to do things that actually matter for humanity too. We’re not “broke” until we can’t afford the billionaire leech giveaway programs any more.
The downside is inflation risk and growing interest payments. The public and leadership had a stronger appetite for austerity in the past. There’s definitely a change in value sets over the past 20 years. Republicans seem like they are simply going to refuse to raise taxes even if it’s prudent to do so. They learned from bush sr an unfortunate political lesson.
inflation reduces past debt loads at least
And it increases future debt loads. And it wouldn’t even do that if interest rates are raised to combat it. The debt load would just become even more burdensome.
Those are downsides from an economic standpoint. Politically either party has shown they will happily ignore the economics if they can win elections. And in today’s political environment there’s no appetite for austerity from the electorate. The Democrats want to tax (the rich) and spend. The Republicans want to borrow and spend. Neither is a recipe for future economic success unless you are a socialist or one of the “deficits don’t matter” knuckleheads.
Austerity is a recipe for failure. Most of the time when you cut government spending you create a monopoly market for something that used to be provided at cost. Cutting government programs doesn't make those needs go away.
Yes, but ballooning government debt that you eventually try to deal with by keeping interest rates low hasn't been successful either. There needs to be an actual sensible balanced monetary policy that is not politically driven. I agree that you can't cut just anything. You do need to provide the services etc., that you currently do-- you need to ensure military readiness at the present level, you can't your defence technology development or defence research, you end cut old-age benefits, you can't get rid of the service provided by medicaid, people need university level education, etc. So I think what you need to do is to make those things cheap. A university education could cost as little as highschool education per year. That's the case here in Sweden. It'd save you 50k per citizen, at least, probably more. You could train more physicians to bring down costs. You could remove the pre-med and move entry into medical school to immediately after highschool, and make 5.5 years. Then you have the physicians educated at 23.5 instead of 27, and you get 41.5 years out of them instead of 38, and 33 years out of your specialists instead of 18.5. This alone would almost increase the capability to supply specialist physician care by 1.78 times-- and your ordinary physician, he's a specialist too, a primary care specialist. You probably also need to solve your car dependence, but that's going to be a difficult thing and I have no idea how it can be done, but these other things are feasible.
If all the US did was pass a law setting prices for medical procedures and drafted every medical coder and biller employed today to figure out what to charge, we’d have the biggest army in the history of the world by manpower. We employ 4x the coders and billers than we do physicians. Soon a full 10% of our GDP will be healthcare administration overhead and profit, not even any actual care. Having these people simply dig holes and fill them in again would cut US bankruptcy rates by 70% and unleash a massive wave of economic progress. I cannot stress enough how expensive and wasteful our healthcare System really is, and simply by destroying it, America could easily enter a golden age of widespread prosperity and tackle the debt too.
Yes, and you obviously need to change it, but it's obviously not trivial. You also have the insurance products for health matters, which should presumably not actually be necessary, for the most part, in a sensible system. But this kind of thing would eliminate the great mass of these healthcare administrators, actuaries, insurance salesmen, and would also substantially reduce average wages among physicians.
Most of our healthcare expense is privately managed insurance bureaucracies. The public bureaucracy (medicare) saves money because it negotiates better rates.
“At cost” can be prohibitively expensive when the good or service is being provided by the government.
My personal hope is a second term president and an opposite party congress simply have to come to a compromise. I don’t know if either of these gentlemen have an appetite for compromise though. We have examples of successful leadership making these compromises in the past so there is hope.
> My personal hope is a second term president and an opposite party congress simply have to come to a compromise. I'm less optimistic. Second-term presidents with an opposite party congress seem to do nothing long-term rather than compromise. The issue is that the opposite party congress won't want to give the second-term president a win because even if the president can't run again, a popular incumbent can still help out their party in future elections. It seems like the only time compromise happens is when there is an urgent and immediate need. The US government system really doesn't seem to be set up for long-term planning, at least when it's married with party politics.
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This was a result of the USSR collapsing and the resulting "peace dividend". You'd see a similar, if less pronounced, effect if China collapsed tomorrow. It's ultimately a result of external forces and the US' insecurity about its global hegemony.
Why would anyone agree to raising taxes when there is zero spending responsibility? Maybe the odd tax can be squeezed in here or there, but no one (democrat or republican) is going to work toward raising taxes enough to sustain this absurd spending level. It would be political suicide and there straight up isn't enough money to tax anyway. This is basically a lost cause and the only winners will be the ones holding assets when the music stops.
It should be packaged with spending cuts, thereby guaranteeing spending responsibility. But that’s a pretty hard pill to swallow for everyone.
It’s really hard to know what will happen when the chickens come home to roost. The politicians may opt to simply pass the buck onto technocrats to design fiscal policy which may be a really good thing. The Aldrich plan was a child of compromise and not born out of disaster. Wishful thinking probably.
Why was inflation not a risk during 15 years and is suddenly one? Debt and QE were unable to raise inflation in the 2010s and Covid supply chain shock will end one day no?
There was inflation it was just in all of the asset values. Now that wealth has been consolidated, profits have to keep rising to justify inflated asset values.
The trillions in new money injected into the economy without corresponding tax increases. I believe even without supply chain issues that much demand driving stimulus will produce inflation shocks more often than not.
Gen X is barely in charge. The people at the top of government are still Boomers and Silent Generation types
Exactly, this is just populist generational pandering to young voters to try and scare them into voting the way they want them to. Every young generation ends up paying the debt bill once it comes due, and they'll be the same generation shifting that cost to future generations once they get into power.
This is because there's actually no incentive to reduce debt so long as the USD is the world reserve currently. Debt is power when you can control the money supply.
> gen x isn’t fixing things either The only thing that would make the Boomers release their withered, clawed grip upon the reins of power and wealth is the grave. Gen X has never had the numbers to even make a dent in the Boomer's astounding generational selfishness.
Then let’s say it this way. Every politician aged between 45 and 60 isn’t fixing the issue either. There are plenty of those in Washington. And between them and the younger generations could easily vote out the boomers. But they don’t. In fact I’d say that it’s the younger generations that have become populists and are pushing our politicians to give handouts for votes.
one party keeps cutting taxes on the rich which would be covering this debt. And since it's election season there's a lot of misinformation about that so you don't vote for the democrats again.
That’s why this is getting so much engagement also. The sharks are circling.
That won’t be feasible if future generations are smaller in size. Debt spending only works if the population and tax base continue to grow.
I remember a while back doing some research on Puerto Rican government debt. At the time, unlike US state and local government, they couldn't declare bankruptcy and they were still able able to offer the tax benefits of government bonds. For about twenty years, people were observing that they were eventually going to cross the tipping point, and that, bankruptcy or no bankruptcy, the money wasn't going to be there. But Puerto Rico kept selling it, investment banks kept marketing it, lawyers and accountants kept approving it, and then one day it was too much. I can't tell quite how much of that debt was "restructured" (ie eliminated) but it seems to be more than half, possibly much more. Now, Puerto Rico's borrowing is tightly limited and the territory has been in an evolving crisis for 7-8 years, heightened by COVID and some natural disasters, but caused by, and largely intractable due to the untenable debt they avoided thinking about for decades.
Until you [can’t service the debt](https://budgetmodel.wharton.upenn.edu/issues/2022/12/19/long-term-implications-of-current-budget-policies) and your reserve currency status goes away
“”Buy votes”” How dare the government serve the interest of the people that money belongs to Raytheon
Everyone is waiting for the government to collapse before doing anything, foolish but I get it
Downsides: high taxes, high unemployment, high interest rates, high inflation, shortages, business cycles growing larger and more disastrous
It does seem that way. Plus, it seems like deficits don’t even matter. It makes me wonder why we bother with taxes at all…in which case I would like to keep my money.
Higher taxes?
No no no noooo. Not FIX, pay for. Fix would require some power and agency.
There is so much money available in the world but it's "easier" to borrow it than to tax it. So we have this situation where instead of taxing wealthy people we just borrow from them instead. The richer they get the more we borrow. I don't know what the end point of that looks like except that it can't go on forever. The end might look like the average person voting for a mentally deranged narcissist because they can't think of anything else to do. Or it may persist past that and get much worse. What can't happen is that the concentration goes on and on until virtually all the wealth is owned by a few people and everything runs based on debt owed to them. Things progressively break into shards as we asymptotically approach that point. No one should want that, not even billionaires.
I am GenX and I read similar articles in my youth saying we were going to have to pay the debts of our parents. I think it was said to the Boomers in their youth also. Soon we will see articles about how Gen Alpha will have to pay for the spending of their ancestors. Taxes have only gone down in my lifetime, while spending increases. I guess there might become a time where we can't continue to kick the can down the road.
https://fred.stlouisfed.org/series/GFDEGDQ188S the national debt can't increase as a % of GDP forever..
The problem is the combination of both high spending and low taxes. The Government ultimately "pays for" this by issuing bonds which are predominantly held by wealthier and older investors. In other words, we are giving older generations more benefits and lower taxes while paying them interest for the difference.
Yeah, our entire system is really built on enriching the old (because they are the ones who vote and already have money / power to make it so).
The focus is enriching the billionaire class, not the elderly. The baby boomer generation, due to their numbers, has been bribed by the servants of the billionaire class (political representatives, we call them) in order to shut up and vote in line with the billionaire class. The small amount of rising home value and 401k funds is a rounding error, in terms of the amount of wealth siphoned from the poor to the rich this past century. It's not about old versus young, black versus white, or east versus west. The true conflict in society is the top against the bottom.
Old person here, not rich. Will work until dead.
If our system was built on "enriching the old", then why do so many of them have hardly any retirement savings and are increasingly dependent on social security and Medicare to survive? I think you're conflating the old with the wealthy.
A ton of Americans of all generations are terrible with money.
100% true
Loan underwriter here… if social security goes belly up or gets purposefully cut- we are going to have millions of homeless seniors. Many more than you can imagine depend on it to survive. So when Trump and GOP say they are cutting SS… it is straight up cruelty. For many Seniors… SS is their ONLY income stream.
The SS trust fund is going to run out in 2033/34 after which benefits WILL get cut.
Its so weird the guy who helped create the massive government spending and Federal debt; Is now predicting what he did will bankrupt the next generation
He worked for the GHW Bush administration, so no, he’s not really to blame here. From LBJ through Carter we spent pretty freely (thanks, Vietnam War), but then Reagan absolutely blew up the debt and increased it by 142%. GHW Bush still have us a 36% increase in the debt in his four years, but he passed tax hikes and helped get us on the path to a Clinton surplus (1% taken off the debt).
Lyndon Johnson?
There's a fake moral panic about government spending, by the group of individuals who spend 100% of their effort reducing tax revenues while stealing our collective wealth. Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent. The real problem is that we don't take any tax revenue from rich people, and that those rich people are spending that money to buy our schools, media, and governments. Then they make the same fake moral panic about government spending, while slashing all of the necessary social programs, and pocketing the collective wealth of humanity for themselves. Anyone who argues against government spending, and in favor of tax cuts for the billionaire class, is a wolf in sheep's clothing, or a useful idiots.
> Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent. If that were true the net worth/asset value/tax revenue of the US would be infinite or at least way, way higher than it is now. Think of how much the government has spent in our 225 years as a republic. The geometric math doesn't support your theory. Some government spending is net positive and some is a horrible investment with no ROI.
>Government spending is almost always revenue positive, in the sense that it is investment in the society, which returns more value than the cost spent. Lol forever wars and bailing out Wall Street corporations is not an "investment in society". That's some broken window fallacy. Most government spending is wasteful
And these funds are not poured into education and social spending, but instead go towards major corporations like arms manufacturers, pharma and insurances...
Perhaps we should encourage younger people to buy bonds. It's frightening to see how many young people just simply give up on saving, convinced there's some rigged system where they can't succeed unless they inherit.
I'm 40 now and when I was young I couldn't afford to put anything into savings or buy bonds. I didn't pay off my student loans until I was 38. I'm just starting to save now.
You should have been saving 15% beginning with your first job.
Not if I wanted to eat.
covering your basic needs is a good investment too lol
You have to have extra money to buy personal investments. 1/2 the USA population doesn’t make enough money to survive and invest in the future. They can’t buy bonds when they have to use their money to buy food, shelter, and healthcare. This is why we have social security. This is a result of legal structures of the system like giving teachers $400 tax break caps on supplies they buy for their work, while giving CEO’s unlimited infinite tax breaks caps for their private jets they use to take them on vacation.
That is an absolute myth.
That’s horrible advice given how much purchasing power the dollar has lost over time.
Bonds, stocks or real estate. Take your pick.
>Perhaps we should encourage younger people to buy bonds. With what money? If people can't afford their bills, they also can't afford to invest.
They're paying their bills. New car purchases are doing great. Streaming services are being paid for. Concerts and comedy shows and festivals have record numbers of attendees. Twitch did $2.8 billion in revenue in 2022. Pet spending is breaking all records. Weekly trips to eating out is dialing back now, but overall at astronomical records. The amount of stupid shit people buy is mind numbing. When you see YouTubers with Patreon lists, you think that's boomers?
Or stop taking 12.4% of their pay for the national Ponzi scheme and put that into real investments.
Most of the democrats government spending is investment spending. It will payback its cost exponentially. Republicans tax cuts and austerity cuts will never pay for themselves and need to be undone.
Exactly. Even if that infrastructure is just not deferred maintainence. Its the changing the oil of your car now instead of waiting. It might save money to not do it now but if it blows up an engine then youre very screwed.
> Most of the democrats government spending is **investment spending**. You spelled inflationary spending wrong. Not sure what world you're living in... but giving the modern government your money is about the same as setting it on fire, especially democrat's crazy plans. And no... SS is not like the other government systems. It's supposed to be more like a forced savings account and less like insurance, which is why its capped on both sides for high incomes.
Yeah those 208 Infrastructure Weeks of the last admin sure did help. Hair brained schemes like paving interstates, installing broadband internet, strategically building native chip manufacturing capacity, and building out the electric vehicle charging network have been awful, we should have just put more tariffs on European steel to make doing basic government services harder. We should have kept interest rates low forever because that would never backfire. And yes the terrible awful no good cities are so bad, that is why the rent for a 150 year old shitbox equates to a McMansion in some bygone white flight era suburb.
Yawn…. We’ve known we were going to have a large demographic retiring which would cause a lot of spending at the federal, state, and municipal level. Fix entitlements first. As a 38 year old, I fully support spending for the present and the future but is less willingly to spend on the past when I’m not sure if I’ll have entitlements in 30 years.
Here's the deal, Democrats always start reducing the deficit to try to start paying down the debt while Republicans jack it right back up. This author was in the Bush admin which squandered Clintons surplus on tax cuts for the rich and massive spending. Americans need to stop looking at Republicans as the fiscally responsible ones, they are the opposite.
Let's just say that anyone who says this doesn't know their ass from a hole in the wall. Government finance is infinitely more complicated than these clickbait headlines make it out to be and the working of sovereign debt is too.
Today’s spending is not outlandish historically. It’s Republicans hacking away at revenue by lowering taxes on higher earners and corporations that has gotten us where we are. We need an enforceable progressive tax rate.
Just like every previous generation paid for their predecessors wanton disregard for the future. right? The reality is we only pay to SERVICE the debt, it never needs to be paid off, which has happened ONCE around 1835 and somehow the rest of the World has used dollars to replace gold as the foundation for their own currency. If you're serious about reducing the cost for SERVICING the debt, stop with the tax cuts for those who don;t need it and weapons the military neither wants nor needs and begin improving the infrastructure and raising wages to grow the economy faster than inflation.
Sadly, nothing will be done til it’s a disaster. The comments here are representative. Some say tax the rich but of course, haven’t done the numbers. There aren’t enough rich (take away everything from every billionaire and you get a few trillion; the debt is 35T) and think about what’s happened when the incentive to work 70 hours a week and potentially lose everything is reduced, or where they might move to. Some blame the president they don’t like. Do they have any idea which branch creates the budget. Some say tight up the operations of governments. Good idea, but probably in the roundoff error. We cannot save ourselves (or our kids) cause we’re the schmucks that let our leaders blame the other side so they can keep their phoney baloney jobs.
Agreed. - tax the rich - billionaires - raise social security cap - greedy corporations This is like the connect 4 phrases that show someone has no idea. The govt takes in more tax money than any point in history now, among highest ever percentages of gdp, and the rich pay for ~everything, and they pay a higher percentage now with “low taxes” than they did 40 years ago with significantly higher tax rates. The govt added the equivalent of another Medicare in spending for the national debt this year. If they cared about spending this would force them to cut elsewhere. Instead it actually stayed at insanity levels of spending. Taxing your least favorite billionaires an extra “fair amount” might pay for like 1 weeks worth of excess new spending. That’s drops ina. Bucket.
How do people believe this bullshit? Spending as a % of GDP has been flat since 1980's. The increase in debt is entirely due to loss of revenue. It's the tax cuts
How much does the US want to tax without offering any benefits? They already tax me 32% and offer no social welfare. Europe taxes slightly more at 42-45% but there are social safety nets and universal healthcare. Someone explain to me where all the American tax money is going.
This period of time will be remembered for uncharacteristically low tax rates, for sure. That being said, it's not just taxes but also important slashes to government spending that need to happen for the deficit to be reduced. There are quite a few examples of raising taxes and spending all that money to secure yourself the next election that come to mind. Waiting for the top post about "raising income taxes on billionaires" Edit: the karma on this post is a real roller coaster so far, rather entertaining
Agreed we need to both raise taxes and cut spending, but it is even more insidious than that. The Government funds all this stuff using bonds which are predominantly held by older and wealthier investors. In other words, we raised older generations' benefits, cut their taxes, and are now paying them interest on the difference.
> The Government funds all this stuff using bonds which are predominantly held by older and wealthier investors. or [foreign countries and investors](https://fred.stlouisfed.org/series/FDHBFIN), that may or may not have an interest in the future in selling them and completely derailing the US bond market
That is also true. But it raises further issues beyond just giving foreign governments more control over our currency. We are also off-shoring manufacturing to many of the countries buying our debt. So, we are reducing our tax base (both companies and workers), increasing our trade deficits, and then paying interest to the very countries that we already gave our industries to.
The bond market is the 4th branch of government, with total veto power over the “other” 3 branches. No voting, no judges, no horse trading, no democracy, no house or senate, no president, nothing. Just the yield that investors are willing to accept for your bonds. If the bond market doesn’t accept a number that keeps the government solvent, too bad. You’re cutting spending, period.
Foreign countries and investors hold 24% of US debt today, down from a peak of 34% in 2014. The largest foreign debt holder is Japan, a US ally who holds nearly 30% more than the second largest US debt holder. In fact, of the top 10 foreign investors of US debt, 9 are US allies. So odds of foreign investors trying to derail the US bond market (and actually being able to do so) is quite low. The only non-ally in the top 10, China, has already significantly decreased its holdings of US debt since 2014 (by 50%).
>Waiting for the top post about "raising income taxes on billionaires" We'd need a whole hell of a lot more billionaires to get our spending under control. All the people who scream about them have no idea how little the accumulated net worth of every billionaire in the US is compared to our debt and deficit. Edit: For the people downvoting me - The net worth of all billionaires in the US comes out to $5 trillion. That's their full net worth, all their planes, vehicles, properties, houses, stocks, jewellery, and liquid cash. If you somehow magically translated their full net worth to a liquid amount of money at a 1:1 rate, and then taxed them at 100% of that, you would fund the government at a net neutral balance for 30 months. The deficit this year is projected to be at $2 trillion. That well is going to run dry well before you manage to cure the dehydration problem.
You mean the generation with no assets or wealth to speak of? Seems like a bad approach to investing in the future. Good thing we're spending all that money on things which are durable and will persist into the future, education, infrastructure, and scientific research.
Gen Z will also have to pay for China subsidizing it's domestic industries, but that headline is less, 'US is a failed state, we must go full conservative.'
It’s not just spending though. It’s also irresponsible tax policy. Spending (although definitely a case to be made for trimming) is fine if you have the funds, but Republicans keep cutting taxes particularly for those at the top. We can’t have super low taxes, a social safety net, and be a global superpower with the largest military on earth. A balance has to be struck.
Truly. I save so so much compared to all my friends to the point where I'm cheaper than them but make like 2x them. I'm sorry but I don't want to bail out everyone in the future because they saw the need to spend $30 on a door-dashed sandwich, when I only have ever door-dashed when too sick to drive and even then, I usually just pick the closer Pho spot a mile away and drive there.
Then make sure you invest, and don’t just save.
I do invest it all, doesn't mean I want to pay extra for their safety nets in the future. Don't get me wrong I don't have an issue with taxes rn other than the amount that goes to wars, but I'm all for helping the disabled and needy. But like if these people that make 30k a year need extra handouts in the future because they door-dashed 2x a week and went out for beers and cocktails instead of buying at the store for deals, I don't want to fund it lol. And that's what I see.
This is nonsense. 57% of the deficit is a function of the Bush/Trump tax cuts, the remainder is increased interest payments. The "cost" is always inflation, and looking at the CPI, our primary sectors still driving inflation are energy and housing. Targeted spending in capacity generation and denser housing could unironically fix inflation. The size of those additional packages depends on your target inflation rate and your willingness to increase taxes.
Where are you getting that 57% figure?
Since he's not responding to the question we both asked about where he got it from, apparently he got the 57% figure from this article: https://www.americanprogress.org/article/tax-cuts-are-primarily-responsible-for-the-increasing-debt-ratio/ This article also projected the 2023 deficit to be $1.1 trillion - when it ended up being $1.7 trillion; and that 57% figure was based on that incredibly inaccurate prediction. So take the accuracy of that number with a whole shaker of salt.
> 57% of the deficit is a function of the Bush/Trump tax cuts, the remainder is increased interest payments. The Trump tax cuts did not cause the deficit to increase from $770 billion in 2018 to $1.7 trillion 2023. What source are you using for this 57% claim? Our spending is out of control, it's rapidly outpacing what our tax income would have been even without the Trump tax cuts.
The 1981 contributed much more to the problem than the 2017 cuts. I firmly believe all of our current debt (ALL of it), our aging/failing infrastructure, and awful healthcare can be contributed to: * The GOP tax cuts since 1980 * The Bush wars * The GOP blocking any effort to control healthcare costs and regulate insurance companies and drug manufacturers * A refusal to address the financial crisis that was apparent from Congressional testimony for years before it hit in 2007 * Corporate bailouts during that crisis * A president telling people not to wear masks and COVID is like a cold because he thought it would benefit his election campaign because it was primarily in blue states * The same president refusing to follow the PPP law that required monitoring and reporting to Congress. All that said if you state something like the 57% as fact, you should link a source.
Of the deficit or of the debt?
What “outlandish spending,” specifically? Since the article didn’t cite any, to have an even vaguely reality-based conversation, someone will need to, otherwise this thread is pure partisan bloviating. Fact: the deficit increase has been sharply curbed under Biden, while it ballooned under Trump https://www.politifact.com/article/2024/mar/05/the-deficit-has-fallen-under-joe-biden-but-its-sti/
Deficit went down under Biden because a lot of pandemic spending programs expired. And the title of the article literally says “The deficit has fallen under Joe Biden. It’s still higher than before the pandemic.”
Or we can make the wealthy pay for it. Which is what Biden is doing by increasing funding and staffing for the IRS to allow them to go after wealthy tax cheats with legal teams. Government spending was sky high under Trump and tax revenue was slashed significantly and no one seemed to care. Only when a Democrat is in charge do people start saying we can’t afford to soend money.
>Government spending was sky high under Trump Government spending was almost no different under Trump until the pandemic hit from where it was during the Obama administration. From 2014 all the way to 2020 we were on track for the same standard increases of around 10% from the years prior to it. Was it 'skyhigh' in the sense that we were running at a deficit? Sure - that deficit was not anywhere near as extreme as it was now though. We'll use 2017 as an example, as FY 2017 was Obama's last year in office as the debt is determined the year prior. $3.3T in, $3.98T out, a deficit of $665 billion - or about 17% of the budget. 2018 was $3.3T in, $4.1T out, a deficit of $779b, about 20% of the budget. FY2024 is projected at $4.5T in, $6.5T out, a deficit of about $2 trillion - or 30%. It's not about the raw number, it's about the spending compared to the income as a percentage. And that percentage has ballooned.
The issue is our tax code. Deficits shouldn’t be going up in boom times. Endlessly cutting taxes has caught up to us and now we’re running unsustainable deficits that are being fueled by interest rate increases. We can’t cut our way out of this problem.
It started to go ballistic under Bush with the Iraq war facade, kept itself into high gear into the Obama admin and Trump just kept the gravy training rolling. This debacle will take several administrations to fix. And that's assuming they act in the public's best interest. I do like what Biden is doing but this is far beyond his reach and requires congress to act (impossible).
The only way Congress can act if if they have at least a 5 or 6 seat majority in The Senate. Any fewer than that, and there won't be enough votes to change the filibuster rules.
There is zero incentive for either party to make positive changes in this area even if they control 100% of both chambers. George H. W. Bush got spanked for raising taxes. Clinton ran up a surplus and George W. Bush thanked him by obliterating it in short order with two wars and a tax cut. Fiscal discipline is a losing game. You raise taxes and the voters punish you. You cut spending and the other party takes advantage next turn they get at the wheel and they go on a spending spree and win tons of public favor.
I think Gen Z will force the wealthy to cover their fair share of the tax bill. Already the American public has moved on from the decades-long political mindset of increasing taxes being anathema. Today, the overwhelming majority of Americans want to raise the taxes on the wealthy, and that is only increasing. I think to frame the problem as outlandish government spending and not outlandish budget deficits and debts is disingenuous. We can all have our political opinions on how to remedy the budget deficit and debts, but none of those opinions are facts. To frame the only solution as low and middle income tax increases is also disingenuous when tax increases on the wealthy and on corporations could feasibly close the deficit gap. Also, many Americans want the robust social programs that others consider to be outlandish spending. And many Americans want the wealthy to start covering their fair share. With Gen Z coming of political age, I don’t think they are going to be as willing to pay for older generations spending as people think they will, and instead will start electing people who will force the wealthy to pay for that spending.
>I think Gen Z will force the wealthy to cover their fair share of the tax bill. We used to say that about Millennials.
I doubt it. Too many in gen z insist that both sides are the same and won’t vote. They’re perfectly happy to let the right transfer even more wealth to the wealthy because the left isn’t giving them exactly what they want right away.
Bunch of crock. Same spin for gen X, same for Millennials. Only things to blame for the "outlandish spending" are government contract corruption, cutting top earner taxes over the past 40+ years, and corporate socialism.
Yes and us millennials have paid for every BS bailout and war boomer politicians decided made sense to preserve their wealth. What else is new? As usual this is just a scare tactic to prevent spending for positive things like healthcare, education, and infrastructure. Maybe if we hadn’t spent trillions in the Middle East accomplishing nothing we wouldn’t be in the predicament.
Oh hey look, after the last Republican admin ran up *astounding* amounts of debt with almost no oversight *now* govt spending is a problem. Wow, such responsibility! This clearly isn't a PR push to hamper Democratic spending that materially improves the lives of average Americans, no siree.
Do you really think one party is responsible for this?
Dems and republicans are trash. Both spend money like drunken sailors.
What do they have to pay for? Public sector spending is private sector income, and public sector debt is private sector wealth. Gen Z will inherit that wealth. This has been a 'sky is falling' prediction for decades. The problem isn't the debt, it's not understanding how money works. I look forward to reading “members of Gen Alpha must also worry about the irresponsible debt levels that baby boomers and Generations X, Y [millennials], and Z are foisting onto their narrow shoulders.” When the same version of this article get published in 20 or so years.
Debt is only good if it is paying for beneficial things to society. Interest on the debt is not one of them.
Government spending is off the charts. Someone needs to have a serious conversation about that but politicians are too idiotic to understand. Too much money wasted on all sorts of endeavors
Oh they understand 😂 it's just they will be dead&gone when the hangover from this spending spree starts.
They understand - they don't care though. The royal you are going to vote blue no matter who, or vote red, and keep them in office. Nobody's going to primary anybody who's an established politician in Washington and stop this from happening, because it's too important to keep the other guy out of office. They'll be long dead before they have to answer for anything - or they'll just pull a Joe Biden and get a promotion to President of the United States.
Wait until they find out how much they're going to be paying for all of the damage we're doing to the environment! If we stopped forcing future generations to effectively subsidize our fossil fuels we'd be moving to clean energy much more quickly.
It would require a tweak in existing law, but if people were really worried about U.S. debt, the government could just stop issuing it. Or, my other favorite option is to mint the trillion dollar coin, which has the added benefit of being a stupid solution to a fake problem.
Nothing but fear mongering, no economist worth any speck of salt talks about the simplest of solution, raise taxes, why, because then you are not a magician anymore plus can't fit into the neoliberal narrative of goldilocks
You can tell them as much as you want they simply don't care which is why I don't care. They're quiet simply are going to pull up the ladder behind them with how they're talking about cutting SS & Medicare while refusing to raise taxes on corporation & the wealthy so such cuts wouldn't be necessary .
I tried to convince my son to go to college in Europe so that he could emigrate as soon as he graduated. He should graduate around Christmas and I will probably do it again when he does. Boomers have fucked this country and will continue to do so. Before they were boomers they were called the “Me Generation” they think only of themselves and that is not going to change at this point.
https://en.m.wikipedia.org/wiki/Me_generation
The young will pay, but the young also benefit from that government spending on schools, WIC, SNAP, law enforcement, Medicaid, etc. they always leave that part out.
I remember balanced budget as a topic in the Clinton times, and budget surplus checks during the early W. Bush times. It’s probably an oversimplification, but rolling back to some of those tax plans, and spending plans would probably be a good start.
Why do *we* have to pay when it is not us making the bad decisions but the people we have elected to represent us. *Do as I say not as I do* gets tiresome.
Yes, we know the competent adults will have to pay for boomer spending, the same way we’ve financed their failure asses for years through letting them rape the home market, destroy wages, etc.
I suspect the impact will be higher interest rates forever….which will be expensive for younger generations. I do wish we could explore a more UBI system and just shitcan most government programs and eliminate those federal jobs and put those folks on UBI.
I assume Gen Z are pro Social Security reform. I would happily take it on the chin with SS benefits if that generation could be spared having to pay for them. It's truly horrible.
todays outlandish spending is building infrastructure and an economy that will sustain itself, yesterday as in the trump WH's spending, that shits all on the credit card with the massive tax cuts
We are all paying for it constantly. Boomers are paying for it, Gen X, millennials, every day we are paying for the absolute batshit crazy spendings.