If my household had an income of 433k and debt of 3.3 million (same proportions as the nation), and a 5% interest rate, we would have an interest burden of 150k per year. That would leave us 283k per year to live on. We could put money toward the principle and be solvent... so long as we stopped all borrowing. We could even pay our 160k retirement & health insurance bill, leaving us 123k a year for other expenses.
But we’d have to freeze our expenses and stop borrowing, and cut our expenses in many areas.
Almost all politicians are only concerned about getting re-elected. This is why the can keeps getting kicked further down the street.
Interesting perspective.
Now increase your debt to $4 million, reduce your income about 10% to $390K (due to recession) and increase interest rate to 7%. You suddenly are living on much less. Your neighbor may get surly and steal your unhappy wife, your kids will riot and burn down the garage, and debt-collectors are going to get a lot more aggressive.
You are totally missinf the point.
If your 433K included 37% payroll taxes that you don’t get, then you are left with $272K to spend.
Using your $3.3 million at 5% is $165K in interest. Not current rates are already over that and escalating.
Using your figures, $272 - $165K leaves $107K for all other payments.
Using the current Federal Budget Spending net of SS & Medicare and Interest in the same ratio, you are spending $414K per year.
So, using your example, you have $107K to pay $414K in bills.
Hate to have you figure our budget!
Note: The total spending was $6.27 trillion and 66% were non SS & Medicare and Interest payments. That’s how I arrived at the ratio to get the $414K you are spending.
Please redo your math without the emotion. This isn’t New Math.
In your example you don’t actually have to stop borrowing at all. If you’re revenue of 433k is steady then you wouldn’t reach a point where you could service the interest. You could indeed pay down the principal and you could take more debt.