Giving new meaning to "unsustainable" . . .

. . . John Taylor plots the growth of U.S. debt if "we don't change policy".

Comments

[pj]

He uses CBO projections. If the CBO projections are right, there won't be any change in policy until at least 2030. The debt just won't be large enough to pressure the politicians.

However, the CBO is optimistic. A few trillion of bank guarantees getting put to the government, plus a sharp decline in GDP, and the ratio could get up to 200% a full decade ahead of their schedule.

[kyle8]

What it really means is that future administrations will be severely curtailed in what they can do. Interest expense will eat up most of the budget.

It will cause inflation, of that there is no doubt.

[JorgXMcKie]

I've been using similar graphs in my grad budget classes since 2000. A *few* of them are beginning to believe Michigan is in an untenable budget situation. Finally.

[Chris C]

Isn't this level of debt growth only possible if the Chinese continue to lend to us? Presumably they would close off the spigot long before we arrived at some of these levels?

[Robert]

So what? How can you take a two or three year "trend" and extrapolate it for another 40 years? That's the source of countless ridiculous predictions.

It reminds me of an NBA game a couple of years ago in which T-Mac scored 13 points in the last minute, and they said that if he did that for 48 minutes, he'd have scored over 900 points that game...