The 4% rule accounts for inflation. The stock market on an average gives you 7% a year in returns adjusted for inflation. The 4% gives you enough cushion in case of economic turmoil.
FWIW there have always been and will always be spelling financial doom right around the corner, but betting that way has been a failing strategy save for lucky few who got the timing just right.
Ditto Germany in 1945.
Ditto Russia in 1918.
Ditto China in 1949.
Is the US going to be the US of history for the next 50 years? Or is it going to be one of Japan, Germany, China, or Russia?
Or is it just going to be, say, the UK? How did the UK stock market do over the last 50 years?
If you think America (or wherever you live) is going to end up like Germany in 1945, or Russia in 1918, then it won't matter in the slightest what you've invested in anyway - you plus everyone around you will be in the same (half underwater) boat.
"Ditto" for if $SPY suddenly tanks or underperforms. There are going to be much more immediate concerns for everyone if that happens.
"Accounts" wrongly, though? 4% inflation for the next half-century seems like complete fantasy. How do you imagine it possibly being sufficient to address the ballooning debt?
The interest we pay on the debt has just passed defense spending this year as a percentage of the federal budget.
I cant imagine how 4% inflation will continue to be the norm as the government has to print more and more money to pay for this stuff.
Which means instead of taxing the wealthy were paying them for the privilege of using their money.
So that could be a good thing.
When the rich were taxed heavily post WW2 the US was a pretty great place to live if you were middle class.
Not sure if that would work out still in a post-gold standard, modern uni-party ruling class USA where taxes may not be used efficiently.
Even some rich people question how little taxes they pay.