[1] https://www.nytimes.com/2020/09/04/opinion/pefco-export-impo...
How are you calculating this? The full-year deficit is running at less than $1T... You aren't counting it when Treasury rolls maturing bonds over into new debt, are you? That's normal and irrelevant.
https://fiscaldata.treasury.gov/americas-finance-guide/natio...
There's a few things worth mentioning, since after all that is still a big deficit.
1) Debt service costs are over $1T annually, as the end of many years of ZIRP finally starts to bite. There's no guarantee that we return to lower rates in the future, but it's likely, and that will reduce debt service burden over time.
2) Deficits are calculated inclusive of the costs of debt service, but do not include the impact of inflation on the public debt (which is substantial right now).
3) Deficits can absolutely be sustainable. The economy (i.e., GDP) grows over the long term, and the tax base grows with it. GDP is around $23.3T, and assuming long-run 3% growth, that would mean deficits of $700B are sustainable.
Overall the fiscal picture is not great, but anyone acting like there's an acute crisis is probably doing it for political reasons.
It's been widely reported [1] that the US debt reached $32T in June 2023, $33T in Sept 2023, $34T January 2024, achieving those milestones roughly every 100 days. The projections indicate an exponential increase, which doesn't help the case for sustainability.
Sovereign debt and fiat ultimately are confidence games. Being unable to offer credible long-term math is a problem.
[1] https://www.cnbc.com/2024/03/01/the-us-national-debt-is-risi...
That said,
> It's been widely reported [1] that the US debt reached $32T in June 2023, $33T in Sept 2023, $34T January 2024, achieving those milestones roughly every 100 days. The projections indicate an exponential increase, which doesn't help the case for sustainability.
These figures aren't interesting because they include debt that the government owes to itself (intragovernmental debt). The debt held by the public is presently around $27T.
When actually considering long-run sustainability, you don't just consider the real GDP growth rate (as I did above). You really need to consider several factors:
1) Deficits
2) Nominal GDP (i.e., disregarding inflation)
3) Nominal interest rates
If you have a ton of inflation, you can effectively reduce the debt burden in terms of a % of GDP, since the GDP grows with inflation and the debt does not.
This is the data series that should interest you:
https://fred.stlouisfed.org/series/GFDEGDQ188S
You'll note an explosive increase due to the extreme pandemic deficit spending (and during the financial crisis), but lately it's actually not an "exponential increase".
The bottom line is it's not as though these are uncharted heights, or that we're presently on an uncontrolled exponential trajectory -- but, we have "run out of room", and if we have another crisis, we're going to be unable to engage in the kind of deficit spending that we have in the past without serious consequences.
Bottom line, our taxes need to go up modestly in the coming decades... but only if these assumptions actually prove to be true:
> Inflation slows through 2026 to a rate that is consistent with the Federal Reserve’s long-term goal of 2 percent and then remains at rates that are consistent with that goal from 2026 to 2054.
> Interest rates generally rise over the next three decades, largely as a result of projected increases in federal borrowing and in capital income as a share of total income.
... I doubt it! Look what happens to interest rates in graying countries like Japan.
But right now, CUDA rules the day in AI. It'd be nice to have a few strong competitors in that space.