The U.S. has successfully navigated past debt challenges, notably in the 1990s. Policymakers can fix this if they find the will to do so.
by Veronique de Rugy
Reason.com
The United States is full steam ahead into uncharted fiscal waters, with rapidly growing federal debt promising a choppy economic future. Candidates Joe Biden and Donald Trump have added trillions to the national debt during their recent presidential administrations, leaving America at a critical juncture that demands urgent, bipartisan action.
If you read this column, you know the numbers are stark: U.S. government debt is projected to reach a staggering 122 percent of gross domestic product by 2034, far surpassing levels seen even during World War II. Not only is that a sharp rise from the current 99 percent, but it’s based on rosy assumptions about interest rates, inflation, and economic growth. The date to watch is 2038, when this ratio is poised to surpass the previous record from the pandemic year of 2020. The end of the pandemic, unfortunately, hasn’t quelled the pandemonium of spending.