The United States ran up a large national debt following WWII thanks to the large deficit expenditures of the war and also of the prior Great Depression. The debt-to-GDP peaked after WWII at about 120% in 1946.
Following WWII, and despite the Cold War, Korean War, and Vietnam War, the debt burden steadily decreased as budgets were nearly balanced (small deficits usually) and GDP rose.
Reagan started his term with $1T in national debt. One trillion dollars. He quickly cut tax rates ("trickle-down economics") and increased defense spending. Military enthusiasts look back on the increased military spending with rose-tinted glasses but often forget about the irresponsible fiscal policies.
Starting with Reagan, deficit spending increased drastically and the national debt skyrocketed, with only a brief but small budget surplus under Clinton.
Despite not being at war for decades and not being at
total war since WWII, the national debt now
higher than where it was post-WWII as a percent of GDP, over $38T and growing by almost $2T per year.
In addition to the decreased tax revenues, entitlement spending (social security, medicare, etc.) also rose dramatically. Approximately $3.8T of the national budget goes to interest on debt and social welfare entitlements.
Expenditures need to be cut by $2T per year, or tax revenues need to rise by $2T per year to even have a shot at inflating away the debt over the coming century.
Otherwise, financial collapse is inevitable. The weakening of the dollar, hastened along by the waning military power of the United States and the rise of a new superpower in the economic center of the world, will cause interest rates to rise as the world financial system gradually moves away from US treasuries as the global reserve asset. Soft power is not possible without hard power, but hard power is now unaffordable.
I agree that a $1.5T defense budget is probably necessary today, but we won't get it. Instead, our middle class will continue to die as growth stagnates and value consolidates in the hands of a small unproductive hoarder class, S&P gains pushed forward by a putrid assembly of AI stocks that promise magic.
#38T in debt. $2T in deficit spending. A dying middle class, decrepit manufacturing, collapsing educational systems and betrayal of allies.
But good luck with the F/A-XX, I guess. That's probably all we need to beat China.
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