According to figures from the Congressional Budget Office (CBO), the US government spent a total of $6.8 trillion in 2021. Of that amount, $4.8 trillion was mandatory spending, otherwise known as entitlements. In other words, money that has to be paid out by law: Social Security, Medicare, Medicaid, Unemployment Compensation, Refundable Tax Credits, Paycheck Protection Program (PPP), and other mandatory spending. Another $350 billion was interest on the debt that we already owe, bringing the total outlay for mandatory spending to $5.2 trillion. The government only collected $4 trillion in taxes. So without spending a dime on the rest of the things that the government must do: defense, courts, prisons, and all of the alphabet agencies, the government is already running a deficit of $1.2 trillion. Add in all of those expenditures, and the deficit rises to $2.8 trillion. Compare that to my post on this topic from a decade earlier.
What is most alarming is the deficit as a percentage of our GDP, which right now is 12.4%. Over the past 50 years, the deficit has averaged 3.5% of GDP. Think about how much spending has risen to expand the deficit to this point. The national debt is now 100% of our gross domestic product. A decade ago, it was 34% of GDP. Three years ago, it was 80% of GDP. That’s without accounting for the money we owe the Social Security trust fund. Add in that amount, and the debt to GDP ratio rises to 128%.
The US isn’t even in the worst shape. Take a look at the debt to GDP ratios of the world’s top 10 debtor nations:
- Venezuela — 350%
- Japan — 266%
- Sudan — 259%
- Greece — 206%
- Lebanon — 172%
- Italy — 156%
- Libya — 155%
- Portugal — 134%
- Singapore — 131%
- Bahrain & the United States (tie) — 128%
In contrast, here are the ten countries with the lowest debt to GDP ratios.
- Brunei — 3.2%
- Afghanistan — 7.8%
- Kuwait — 11.5%
- Democratic Republic of the Congo — 15.2%
- Eswatini — 15.5%
- Burundi — 15.9%
- Palestine — 16.4%
- Russia — 17.8%
- Botswana — 18.2%
- Estonia — 18.2%
Note that Russia is the only large, first world country in the bottom ten. The suspicious side of me wonders if that is why the Democrats are so keen on starting a war with Russia.
What we are seeing here is that the entire world is on the verge of an economic collapse caused by profligate spending and loose fiscal policy.
5 Comments
Joe Blow · January 6, 2023 at 7:15 am
Winner winner chicken dinner!!!
The politicians are ramrodding the west (thats us, folks!) into war with Russia so as to hide the financial malfeasance of the last 50 years. Its history repeating itself for any who bother to pay attention.
Rather than admit the political class has sold us down the river while enriching themselves, they will send our children to die in a foreign land lest their grifting children get found out.
Dispicable doesn’t even come close to describing the filth that claims to be our ‘leaders’
It's just Boris · January 6, 2023 at 8:23 am
And that interest payment is on debt incurred mostly at the very low, historically, interest rates over the past few decades. As debt comes due and is renewed at today’s higher rates, the interest payments will continue to increase too.
The same is true, coincidentally, of companies. If you hold individual stocks, this would not be a bad time to look at their debt posture.
Not So Great Reset · January 6, 2023 at 9:31 am
Wiping it all out intentionally in order to bring about CBDC.
Citizenship worthless and money worthless is ordered by the globalists and you don’t really want to know just how much the UN owns the FUSA.
Anonymous · January 6, 2023 at 10:25 am
MMT proponents are running things.
Anonymous · January 6, 2023 at 11:14 am
As the definition of “work” in economics is ‘producing output more valuable than the inputs’, you’re not foreseeing the collapse of the economy, you’re foreseeing the collapse of communism.
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