Reuters
Joergen Oerstroem Moeller, National Interest: America's Greatest Enemy Is Neither China nor Russia (It's Debt)
What happens if the United States can't pay down its debt?
What looked possible some years ago have with recent economic policy decisions turned into a realistic scenario: the United States face a technical default.
The figures and forecasts published by the Congressional Budget Office (CBO) leave little doubt. Currently, net interest burden accounts for 1.6 percent of Gross Domestic Product (GDP) equal to 9.4 percent of federal revenue absorbing about one out of every ten U.S. dollars of federal revenue. In 2022—four years from now—it will be 2.7 percent of GDP equal to 16 percent of federal revenue absorbing one out of every six U.S dollars of federal revenue. Measured in share of total outlays, net interest will jump from 7.6 percent in 2018 to 12.2 percent in 2022 and 13 percent in 2028. This forecast though is based on very optimistic assumptions for the U.S. economy. Taking changes over the preceding couple of weeks into account, a net interest burden of 20 percent of total federal revenue looks realistic—a staggering figure with every American seeing one of every five U.S. dollars paid to the government used to finance debt.
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WNU Editor: The U.S. is an incredibly rich country .... with more than enough resources that can quickly reverse this trajectory of accumulating more debt to fund government programs. The problem is that there is no political will to do it .... because there is no desire among the U.S. population to vote for politicians who will reverse this trend. When will that point arrive when the will to do something will be there arrives is an answer that I do not know. But if I was to hazard a guess .... I give it another 10 to 15 years.
