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“a bit doom and gloom” I don’t think there’s a scenario where you can look at any country with this much debt, break the news, and then have it not sound like

“a bit doom and gloom” I don’t think there’s a scenario where you can look at any country with this much debt, break the news, and then have it not sound like gloom and doom. This just reminds me of the Mel Brooks Robin Hood Movie: “Maybe, if you break the bad news to me, but in a good way, then it won’t sound so bad!” https://m.youtube.com/watch?v=Mi-YLIwkfJs https://m.youtube.com/watch?v=Mi-YLIwkfJs “That will probably happen here.” Can you even conceive of how much inflation this would require, especially at the pace of the debt’s growth? People would be rioting.

tim333 2y ago
In the UK where I live it went to over 250% of GDP after the world wars but life went on and it reduced to about 50% over the following decades, and then bounced back a bit. https://articles.obr.uk/300-years-of-uk-public-finance-data/assets/fc7VT0rSq2/government-borrowing-and-debt-since-1700-3125x1842.jpg https://articles.obr.uk/300-years-of-uk-public-finance-data/... I mean not ideal but the 50s and 60s were quite good in the UK.
- gjsman-1000 2y ago
  True; but the UK had at least three advantages: Huge post-war economic growth, a high export market (rebuilding Europe takes material) boosted by US aid to those countries, and the Bretton-Woods system made negotiating the debt easier by ironically relying on the stability of the US dollar. The US would not have any of those advantages. There's not a more stable dollar alternative to look to, there's not an obvious ludicrous economic boom on the horizon, the export market's probably not growing that much, and US taxes don't have much headway to go up before being counterproductive and stalling growth (if they haven't already been doing so). Stalled growth results in less tax revenue, defeating the point of the tax increase. In a nutshell, the UK was partially saved by the US and countries rebuilding themselves. The US has no savior.
  - tim333 2y ago
    The US has the world reserve currency thing making it easier to borrow although I think that is a bit overrated. It is also the world leader in a lot of the most important industries especially tech and AI which should help things.
  - LUmBULtERA 2y ago
    An optimist might see the combination of plentiful non-fossil fuel energy, AI, and advanced robotics as a potential pathway to a ludicrous economic boom. Although it is certainly not a given.
    - Der_Einzige 2y ago
      You don’t need to be an optimist to see that the USA will only pull ahead on its genAI dominance and that genAI will power this boom and the next several.

tim333 2y ago

In the UK where I live it went to over 250% of GDP after the world wars but life went on and it reduced to about 50% over the following decades, and then bounced back a bit. https://articles.obr.uk/300-years-of-uk-public-finance-data/assets/fc7VT0rSq2/government-borrowing-and-debt-since-1700-3125x1842.jpg https://articles.obr.uk/300-years-of-uk-public-finance-data/... I mean not ideal but the 50s and 60s were quite good in the UK.

gjsman-1000 2y ago
True; but the UK had at least three advantages: Huge post-war economic growth, a high export market (rebuilding Europe takes material) boosted by US aid to those countries, and the Bretton-Woods system made negotiating the debt easier by ironically relying on the stability of the US dollar. The US would not have any of those advantages. There's not a more stable dollar alternative to look to, there's not an obvious ludicrous economic boom on the horizon, the export market's probably not growing that much, and US taxes don't have much headway to go up before being counterproductive and stalling growth (if they haven't already been doing so). Stalled growth results in less tax revenue, defeating the point of the tax increase. In a nutshell, the UK was partially saved by the US and countries rebuilding themselves. The US has no savior.
- tim333 2y ago
  The US has the world reserve currency thing making it easier to borrow although I think that is a bit overrated. It is also the world leader in a lot of the most important industries especially tech and AI which should help things.
- LUmBULtERA 2y ago
  An optimist might see the combination of plentiful non-fossil fuel energy, AI, and advanced robotics as a potential pathway to a ludicrous economic boom. Although it is certainly not a given.
  - Der_Einzige 2y ago
    You don’t need to be an optimist to see that the USA will only pull ahead on its genAI dominance and that genAI will power this boom and the next several.