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  • Hacker News
  • Here are the numbers for the US, as a percentage of GDP:

    - Government Debt: 123.0%

    - Tax Receipts: 17.2%

    - Spending: 23.1%

    - Deficit: 5.9%

    - Interest on Debt: 4.2%

    So yeah, 1/4 of taxes go to paying interest. To allay the debt concern crowd a bit: gdp numbers are real numbers, so inflation of 3% and growth of 1% = 4% nominal, so that deficit number actually means that next years govt debt as percent of gdp won’t be materially higher.

    This is the government playbook: create actual inflation of 6% per year, with reported statistic inflation of 3% per year. This means real growth looks like +3% before you need to talk about contractions/recession.

    All this means that the sovereign crisis is not near and the government steals your savings at 6% per year.

    by m101
  • The US emits two types of scrapes of paper, one of which (bonds) promises the other (the us dollar) and the "experts" somehow think america can actually go bankrupt. That's hilarious.
    by mono442
  • Interesting part is the gap between beliefs and prices => if the investors expect a US debt crisis we expect it to show up somewhere in the term premium real yields dollar or inflation expectations ; those signals can remain muted for a long time
    by latentframe
  • US government solvency is backed by the power to tax and tap into the massive US economy.

    Considering the US has one of the lower overall tax rates of developed economies, I’m not sure we’ve reached any sort of crisis level

    by refurb
  • What happens if US becomes insolvent? Is USD going to be inflated? hyperinflated? Will other currencies appreciate or just devalue their own currency by the same percentage to keep up the exports and continue to earn USD for oil?
    by thelastgallon
  • https://archive.is/L8RM7
    by root-parent
  • Financial markets work in strange ways.

    The markets generally respond to US concerns by buying more US treasuries. That’s counter-intuitive but reflects the situation that if things hit the fan they feel loaning the US money is still the safest place for their money.

    For better or worse there’s unlikely to be a scenario where the US becomes insolvent but it’s not far worse for those outside the US.

    by cmiles8
  • From 2018, "Sadly, Fiscal Restraint Is No Longer a Core Principle of the GOP":

    * https://www.cato.org/commentary/sadly-fiscal-restraint-no-lo...

    When you've lost the Cato Institute…

    More recently in 2025, "The petrodollar, not GOP fiscal restraint, is what sustains our unsustainable debt":

    * https://thehill.com/opinion/finance/5465671-republican-fisca...

    Not that I believe the folks at the top at the GOP really cared about it, ever, going back to (at least) Reagan; it was mostly an excuse to cut taxes on the wealth and cut social programs:

    * https://archive.is/https://www.nytimes.com/2003/09/14/magazi...

    by throw0101d

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