At what point does debt become unsustainable?
 

Interesting article on global debt.

The world is sitting on a $91 trillion problem. ‘Hard choices’ are coming | CNN Business

The most disturbing language is that “Tackling America’s debt problem will require either tax hikes or cuts to benefits, such as social security and health insurance programs.”

The good news is that we may have another 25-30 years before the world economy collapses.

I am glad that I am not graduating high school this year.

Any comments or suggestions from any economists or financial experts? Is it as dire as predicted? Or does it exaggerate the problem?What are the solutions?

Income $10. Outgoings $9. = Happiness.

Income $10. Outgoings $11 = Penury.

Simple.

At what point does debt become unsustainable?

Ask the Greeks.

Correct. But, the Greek debt could be bailed out by other countries. Our debt is too large to be bailed out by anyone.

I am pretty sure there are plenty of other places in the federal budget to cut than SS and health insurance. There are a lot of government departments and programs to look at first.
Maybe slow down on foreign aid?

One of my favorite quotes! Although my wife is tired of me quoting it.

I agree that nobody is going to bail us out as a country. But there is another aspect of this that seems troubling. We are The United STATES of America. Media always emphasizes the doom-and-gloom aspects of everything, so we automatically have to wonder if what we're hearing is the truth, but we're hearing more and more about this-or-that large northern city or coastal state spending themselves to the verge of bankruptcy.

So...who bails out said cities or states when they DO eventually tumble off that particular precipice?

I thought that already happened in Detroit and Stockton. I just assumed that the Federal Government is bailing them out, but they don't want the public to know about it.

No need to pay it back.

30% of US debt is held overseas............if it's not paid back......the countries will survive. They are holding the debt..........it's really not "in the system".

Another ~30% is held by "US government". SSA, Federal Reserve, Retirement Agencies. Just "print money" when & if the funds are needed if the agency can not redefine.

The last ~40% is held by US individuals and institutions. As individuals die, right off the debt.....no passing to next generation. For institutions, write off 10% per year.

Flush the toilet.

:popcorn::popcorn::popcorn:

We are getting closer and closer to disaster. Interest on the debt is getting unsustainable.

neither a financial expert, nor an economist, just another poster with opinions who posts. :rant-rave:

As long as the country can afford the interest payment, and can refinance/ rollover the principal, all its good. . remember that the US government is not the same as a commercial / private lender. that being said, as long as the USD is strong, money will keep flowing in from international lenders to the US GOVT. . its not all about the US citizens buying the US GOVT debt. However, if the US economy starts to tank in big terms, and the treasury funding is having a hard time selling the debt at the same or lower interest rate, then there will be a problem.

The key is to keep inflation low, which favors saving vs buying because prices are constantly increasing quickly. . and keeping the better economy amongst all the others, doesn't have to be great, just better than the alternatives.

When a bear attacks, you don't have to be the fastest runner, just not the last/slowest runner. . ie, better to panic early and be skeptical than oblivious. .

ever since i began paying attention to politics in my 20's, i've always heard the warnings on national debt. it never seems to get better, only much worse. will it ever end?

i bet the Saudis could do it

who else? we the taxpayers

Scary. Especially to those of us for whom one of the reasons for moving here was to escape those cities/states spending themselves into oblivion.

A taxpayer bailout only encourages more of the same.

No way. Saudi Arabia's GDP is only about $2 trillion. The U.S. GDP is $28 trillion and our debt is $34 trillion.

Perhaps the relevant question is, “has the national debt ALREADY reached an unsustainable level”? There is absolutely no doubt the debt level will reach unsustainable levels if we continue on the current course.

When can no longer print worthless paper money. :welcome:

Well my formula income 4 dollars outgoing 10 dollars which current track IMO.

If you are unable to pay off your credit cards every month.
When you have loans other then your home mortgage.

Both went through bankruptcy, only place a bankruptcy can be done is federal court, employees took a hair cut, but did not do too badly, no federal money to bail them out. But the numbers were not that large. Other municipalities and states have much larger unfunded liabilities, my understanding is the real danger is that of a cascading effect, a large enough default could start a chain reaction that could take the whole economy down.

While traveling this week we pulled into a McDonald’s just off the Interstate. Nobody to wait on you at the counter - please use kiosk sign. There was a line of about 12 - 14 cars in the drive-thru. On the counter next to the register was a rather large sign. “Sorry for the inconvenience. We need 10 employees immediately will train $15 hour starting wage no experience required.” We waited for food/beverages about 20 minutes after ordering on the Kiosk. 1. There is a serious workforce shortage. Plenty of jobs but nobody to fill them. 2. Apparently it is better for many not to work because child care and medical is so expensive. 3. 1% and 2% wage earners pay proportionately less taxes than do middle class wage earners. 4. Congress cannot compromise for the good of the Country as was done in the past. All of this contributes to spending more dollars than is taking in. No political references intended as there is plenty of blame to go around.

So?

Any old, or almost old, regular citizen who is convinced the aged will not be the first to go is naive — and/or has lost the ability to think critically.

A Plutocracy will take out SS and Medicare, whether it be slice by slice or with a cleaver.

Plutocrats do not need SS and Medicare. But they never seem to have enough money. Given full reign, Plutocrats will never sacrifice themselves, not even just a little bit, which is pretty much all it would take.

Think!

Boomer — one of about 73 million Boomers still here.

Boomer$: The Pig in the Python……..Hard to miss. And Plutocrats will not miss.

Particularly since, unbeknownst to most taxpayers, a hefty portion of that foreign aid swings back around and goes into the pockets of the U.S. legislators that approved the aid.

One of the many ways some Congress critters increase their net worth substantially after being elected. Not to mention that the leaders of the, usually, Third World countries receiving the aid also siphoning a chunk for themselves.

I don't know where people get that idea from. We don't just print up extra money---we BORROW it---mostly from ourselves, some from other countries. Last I heard it was 15% international ownership---someone above posted 30%---it may have reached that by now. But the concept that someone in the Bureau of Printing and Engraving is working the presses overtime is nonsense

If you think the top 1 or 2% pay LESS than the "middle class", you're dreaming. Remember, 47% contribute NOTHING. The top 1% pay 10% of tax and the top 10% pay 60%. But if anyone thinks the "middle" pays less, bring on the flat income tax----tomorrow.

Correct. And, I wish someone would tell me how to take advantage of these so-called tax loopholes to avoid taxes. My Federal income tax payments exceed everything else I spend money on combined.

It's a mental shell game that certain politicians like to play. They harp about the sometimes lower tax rate paid by high earners while not mentioning the total dollar amount they pay in taxes. Weak minds believe the spin.

Good info here: Who Pays Federal Income Taxes? Latest Federal Income Tax Data

Are you willing to UNretire, part time? If so, I have ideas for you.

And sadly they get reelected over and over

Don’t forget, the business owner pays double into social security with no extra benefits.

If your credit card limit is $10,000 and you carry a $9,900 balance, you call the issuer and ask for an increase to $15,000. This cycle will repeat until you are denied another increase. If approved, are you better off? Of course not. You will fall deeper and deeper into debt hell. At some point the interest on the debt will consume so much of your income that you will fall behind on true necessities such as food and shelter.

Obviously, our government plays by a completely different set of rules.
However, there are similarities. At what point does the national debt become unsustainable? IMO we are there now or certainly knocking on the door. What services will be cut or disappear? Will it be the military, social security, healthcare? The list is endless. Our legislators can’t simply tax their way out of this.

How many times have we heard that the “rich” must pay their fair share? Unfortunately, these people never define exactly what fair share is. The Laffer Curve is an attempt to determine the maximum amount of taxation that can be levied before a decision is made by an individual or business that it’s simply not worth the effort to generate additional income. The answer varies between 50% and 70%. In other words, why would I work extra hard and additional hours to make an additional $100,000 if the government takes away $70,000 of it?

Also, don’t forget the insane pension liabilities that will throw fuel on the fire of fiscal incompetence.

Well, we have had huge election "problems" for quite a long time. Too many Americans seem to want to stay in denial about that. So, they get who they are 'given'.

We can see to a large degree what has happened with our own two eyes. Yes, there is a labor shortage, not only for McDonalds, but in an entire wide range of professions. Including law enforcement officers, doctors, nurses, home care workers, pilots, the list goes on and on.

The pandemic had a big impact on this. We lost 1 million people to the pandemic, and tens of millions more got sick. I don't want to argue whether all the people actually died of COVID or with COVID, there were millions of "excess deaths" above the normal trend line....argue if you want, but it was significant enough to lower average life expectancy by more than a year in this country. Folks were locked down and had plenty of time to think about their lives. Many families decided that living life to the fullest was more important than making as much money as they could. Lots of families decided to downsize and do with less in order to have one parent stay at home with kids. There were millions of "excess retirements," i.e. the number of retirements exceeded the normal trend line by millions. Folks saw that life can change on a dime and decided enough was enough. Look how many early retirements are apparent in The Villages. The result is that we have far more job openings in this country than the number of unemployed workers. 4% unemployment is what the economists call "full employment."

I don't think it's going to change anytime soon and will likely get worse. The next three years are the peak of the Baby Boomer turning 65. Through 2027, 11,300 people will turn 65 in this country every single day. Some may stay in the labor force, but most will leave it. Meanwhile, we have a birth rate that is at its lowest in 100 years. We do not have enough births in this country to match the number of deaths. Without immigration, our country's population would go down every year.

Finally, and this is really not political but a fact, there are some jobs that Americans either can't or won't do. 80% of the workers on farms are foreign born. We need people to harvest our crops, vegetables, fruits and nuts. According to farmers in many parts of the country, Americans won't do this backbreaking work regardless of pay. There are other occupations as well with very few American-born workers.

Actually we get who we vote for over and over again.

This the thinking that got us into inflationary problems.

Why do you think politicians leave office richer than they were when going in?

In many, many cases, not so.

The election problems are legion, have been for a long time and are ongoing, as previously stated. There is MUCH information about it easily findable online.

Access to inside information and access to giant Govt coffers with one method being the one I mentioned above.

Some clever types even created an ETF that tracks primarily the trades of the former Speaker of the House - she's done so very well in the market for years (inside info). An ETF that tracks the stock trades of Democrats in Congress has been beating the S&P 500 on the strength of Magnificent 7 tech bets

This thread is going to get shut down soon! :$: We're venturing into verboten land.

Who writes tax laws? lawyers, they write in those loopholes that only they can cash in on. common people have to follow the lopsided law. Just like inheritance tax, taxing stuff that taxes was ALL ready paid on. Legalize stealing.

We will all pay with higher debt default called inflation like we have now. The only way out of their counterfeit money racket is thru self-custody Bitcoin. The young will be forced via poverty/survival pressure to figure that out.