The USA can continue overspending, lending and making payments, all while taxing minimally - for a limited time only. Eventually, that equation will need to change.
The choices are tighten the belt and/or increase taxes, war and the appropriation of resources, and/or renege on debt and start printing money. All choices and consequences (in some cases dire) sadly left to the next and future generations.
You know I have been hearing this and its many incarnation debt related doom scenario for atleast 20+ years, when I first started following it. Probably longer. Every few years, when debt related doomed future story pops, I feel lile no one really knows what is going on, or even worse what they are talking about.
Nobody that is serious about the topic believed in some kind of doom scenarios. Indeed people who are actually in this topic pretty much agree on the general numbers on the topic. The 'doom' talk is from people who don't know shit. However that doesn't mean there is no problem.
There are plenty of people who know whats going on, its not even very complex. What people disagree about is the long term implications.
The reality is this, the US getting to the point where the debt servicing costs as much as the military. And future spending is known to be high simply by the already promised social benefits.
And the debt servicing could go much bigger if interest on debt goes up even slightly. Ever 1% of increase debt might result in a whole US military worth of extra debt serving per year.
So, eventually the US will either have to raise taxes broadly on the whole population, or cut social spending by a large amount. Both are politically untenable and thus have a high potential of not happening or resulting in a serious political crisis.
As long as neither of them happens, the situation is getting worse, and critically getting worse with ever increasing speed. And that simply isn't possible to go on forever.
So its easy to go into an exponential curve of things getting worse and worse. All the other countries that ran into problems also had people say 'wouldn't happen here'.
So this isn't a doom for the next couple years, even decades but even until then, spending large parts of your GDP with debt servicing isn't really great way to spend money either.
Personally, I don’t think @aryehof is wrong, it’s just that governments do really well at pushing the ball down four more years, until they can’t. It’s like that with all Empires.
The choices are tighten the belt and/or increase taxes, war and the appropriation of resources, and/or renege on debt and start printing money. All choices and consequences (in some cases dire) sadly left to the next and future generations.