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so a $1T loan is about 5% of gross annual income No, this is not right at all. The total income of the United States government is $4 trillion per year. So a $
by 300bps 5y ago
so a $1T loan is about 5% of gross annual income
No, this is not right at all. The total income of the United States government is $4 trillion per year. So a $1 trillion loan is 25% of gross annual income. The $3 trillion being added to the debt is 75% of gross annual income.
GDP is not the income of the United States government. But this new debt will be debt of the United States government.
The reality is that we are $29 trillion in debt now and adding to it rapidly. That is 7.25 years of gross income in debt. What would you say to someone that made $100,000 per year and was in debt $725,000?
- amalcon 5y agoGDP is the gross income of the United States. The revenue of the federal government doesn't quite have an individual analogue, because it's somewhat arbitrary (it is effectively a fraction of GDP that can be unilaterally increased or decreased by Congress, though doing so has side effects). If you're trying to make a comparison with an individual, you'd need to come up with such an analogy. Gross income isn't it.
- wbsss4412 5y agoSetting aside your remarks about GDP not being relevant for government financing, The government is not a household, it exists in perpetuity. The time scales with which it can service debt are completely different.