[Vision2020] Debt to Rise to 152 percent of GDP; Greece at 170 percent

[Nicholas Gier]

Trump, the self-proclaimed King of Debt, along with the tax-cutting GOP
have received their "rewards."

Evan Halper, Los Angeles Times

Tax cuts championed by President Donald Trump are pushing the nation toward
an unprecedented level of debt, heightening the risk for another financial
crisis, according to the nonpartisan Congressional Budget Office.

The budget office's annual look at the government's long-term financial
outlook paints a grim picture, projecting soaring deficits in the coming
years, with debt ultimately peaking at more than 152 percent of the
nation's gross domestic product.

"The prospect of large and growing debt poses substantial risks for the
nation and presents policy makers with significant challenges," Keith Hall,
director of the budget office, said in a statement.

The biggest problem in the coming decade stems from last year's tax cut. It
is estimated to increase the deficit by more than $2.3 trillion over that
period.

The spiraling price of providing subsidized health care and social security
for the nation's aging population adds to the problem, the budget office
said.

The federal debt already stands at the highest level relative to the size
of the economy that it has been since the aftermath of World War II. At
that point, the nation was deep in the red from the war effort and the
public works projects implemented in response to the Depression.

More recently, America plunged back into a high level of debt to combat the
Great Recession, when Congress passed major spending increases to pull the
nation out of it.

But Washington not only failed to wipe out the red ink when the economy
rebounded, after a few years of progress in President Barack Obama's second
term, the government under Trump has reversed course, moving toward even
higher debt levels.

The national debt is projected to surge upward, bringing the nation into
uncharted territory unless the government adopts far-reaching policy shifts
that could include deep cuts in spending on entitlement programs or
significant tax increases.

The report lays out precisely what it would cost to keep the long-term debt
from soaring.

To bring the red ink down to the historical average level, taxes would need
to increase 17 percent - $2,000 per household - or government spending
would need to be cut by 15 percent. Over the last 50 years, federal debt
has average about 41 percent of the gross domestic product.

Just keeping the federal debt at its current, historically high level,
would require increasing taxes by 11 percent - $1,300 per household - or
cutting spending by 10 percent.

The heavy level of debt is already taking a toll on taxpayers. The report
projects that government borrowing costs are on track to exceed the amount
the government spends each year on social security.


-- 

A society grows great when old men plant trees whose shade they know they
shall never sit in.

-Greek proverb

“Enlightenment is man’s emergence from his self-imposed immaturity.
Immaturity is the inability to use one’s understanding without guidance
from another. This immaturity is self- imposed when its cause lies not in
lack of understanding, but in lack of resolve and courage to use it without
guidance from another. Sapere Aude! ‘Have courage to use your own
understand-ing!—that is the motto of enlightenment.

--Immanuel Kant
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