America has reached a turning point on debt

American Thinker ^ | 07/10/2025 | William A. Owens, Barry W. Poulson

[SeekAndFind]

The Big Beautiful Bill Act (BBBA) will add trillions of dollars to the national debt over the next decade. Elon Musk is right that this is a turning point for American citizens. It is now clear that neither political party has the will to enact a fiscally responsible budget or solve the debt crisis. Musk threatens to form a third party if Congress kicks this can down the road.

The budget process is broken, as special interests continue to carve out their bits of a spoils system. Congress is not even willing to discuss reforms in Social Security and Medicare. The trust fund for these two entitlement programs will be depleted over the next decade, and they will then be funded on a pay-as-you-go basis. The unfunded liabilities in these entitlement programs plus the federal debt are now estimated to be over $100 trillion.

This turning point may not result in a debt crisis such as that experienced in Argentina. Argentina defaulted on its debt several times, resulting in financial crises. As debt increases relative to national income, the U.S. is experiencing secular stagnation — i.e., rates of economic growth significantly below the long-term average. The economic impact has been felt by citizens as they learn to live with higher rates of inflation, lagging growth in real wages, and diminished economic opportunities. It's fair to say that for many younger citizens, the American dream of prosperity, including homeownership, college education for their children, and a comfortable retirement, is fading.

More troubling than these economic impacts is loss of trust in our political institutions. This is especially true for younger generations who will foot the bill for Congress’s fiscal profligacy in higher taxes over their lifetime. Citizens are no longer willing to give legislators the discretion to pursue unsustainable fiscal policies.

[SeekAndFind]

We can learn from another country ( if we have the collectie will to do it ) — SWITZERLAND.

Citizens in Switzerland faced a similar turning point in the early 1990s. Switzerland was experiencing unsustainable growth in debt that threatened economic stability and long-term economic growth. Swiss citizens responded by enacting debt brakes at all levels of government. The debt brake at the federal level was enacted as a constitutional amendment through a referendum with support from 85% of voters.

The debt brake mandates that the federal government cap the growth in spending at the long-run rate of growth in the economy. The government may incur deficits but must balance the budget over the business cycle. With the debt brake in place, the Swiss reduced debt to 30 percent of gross domestic product. Sustainable fiscal policies have allowed the Swiss to achieve prosperity well beyond that of other developed countries, including the U.S.

[Salvavida]

Let’s all join hands and gracefully walk off the cliff together, wrapped in normalcy bias. We’ll all know once we hit the bottom.

[ducttape45]

My daughter and I were just talking about this very subject earlier. She is not happy with anyone in Washington DC, and neither am I.

[Lod881019]

Elon Musk literally has not opposed a single spending bill other then this one and this one strips ev subsidies funny how that works

[Jim Robinson]

also I believe the CBO counts the tax cuts as a cost to the government. Don’t know what the total of the tax cuts are over the next several years but it’s us keeping our own money.

[allendale]

If Trump at the end of his term leaves office with the national debt increased and government spending even higher, historians will consider him a colassal failure. If he were wise he would have listened to Rand Paul and Elon Musk. He had a historic opportunity to save the nation from the deadly daggers of spending and debt.

[VanShuyten]

“This turning point may not result in a debt crisis such as that experienced in Argentina...”

It will. It won’t be while I’m still kicking, but everyone here should educate all your youngins what the folks in other countries faced with collapsing currencies did to make it through OK. I suspect we’ll be more resilient than most, but perhaps more violent, too.

[BobL]

I’m all for reducing government spending as long as the reductions DO NOT AFFECT MY GOODIES (SS and Medicare). But reducing just about everything else, other than defense, sounds good to me. Let’s get started!

[Varsity Flight]

* #1 National Debt: failure

* #2 ⛽ Fuel Prices: failure

* #3 Overriding rouge judiciary (arrests): failure

* #4 Ending Ukraine Joker : failure

* #5 Costs of living, utilities/housing: failure

* #6 Facial to Canada: failure

* #7 Tariffs: Success

* #8 NGOs exposed: Success

* #9 Immigration outage: Success

* #10 Interest rates: failure

Current Scorecard: 3-7. Loser

[Owen]

The most difficult part of the entire matter is the inability of the world of conservatism to stand up and recognize that capitalism has failed. It failed in 2008.

In the world of GDP things are often measured by percentage. What percentage gain over the previous quarter.

Do you want to do something scary? Compute the number of dollars added to GDP each year and compare that to the government deficit. What you will find is that the money pumped in to the system by government deficit is larger in magnitude than the growth of the GDP.

The system, the economy, is functioning as friction. That money coming out of the government is pumped in and less than that amount is added to GDP. That’s what failure of capitalism looks like. That’s what failure of anything looks like.

Money is a substance created from nothingness and we should not be surprised when basic arithmetic involving it doesn’t work.

[Lod881019]

Exactly Jim and that’s never a bad thing

[nathanbedford]

Many who count themselves among early supporters of the amendment by states movement make two points:

first, the arithmetic of the amendment confirmation process requires such an arduous supermajority among the legislative bodies of the states, that runaway amendments are virtually impossible. It would require only 13 legislatures of 99 to defeat an amendment.

second, the daunting arithmetic also means that no amendment of any sort has a prospect of passage unless there is a life changing national emergency, such as a fiscal death spiral. Otherwise the author is correct, the ordinary course of American politics will sadly not save us.

[Mr Radical]

You are getting these two words confused: capitalism and socialism.

[Mr. Blond]

We’re in the age of MMT. Taxation only exists to fight inflation.

[Jim Noble]

“ resulting in financial crises”

OK, so Argentina had “financial crises”. THEN what happened? Is the population in Argentina being crushed by debt, or did their oligarchs get screwed?

How are things there now? What is the net result of debt repudiation for the regular person? Good, or bad?

Our debts are obviously going to be repudiated.

We should start planning for the day after.

[The Spirit Of Allegiance]

“capitalism has failed. It failed in 2008.”

---

NO! Capitalism, like the Constitution, is not broken.

Cloward-Piven treachery *subverted* capitalism. Think: USAID, etc.

Massive policy and other changes can cancel Cloward-Piven.

Give this Administration a little more time. The Left has bet the farm against us, we need to raise the bet and bet the farm on good policies. Not every good policy will be perfect.

[SaveFerris]

It’s just a matter of time

4 years ago I stood in a large rented church tent
while actor Kirk Cameron told the audience that
America would be around for another 1,000 years

Nearly all of the 1,000-1,500 in attendance clapped their hands in glee

I just shook my head - completely delusional

We are racing towards the New World Order of Daniel 7:23

I expect Satan’s Antichrist to show up along with Global
Economic Meltdown, then Societal Breakdown followed by
the usual things that follow

The only question is how much time are we going to buy

The Federal Deficit, much as we wish, was never going to
be reduced to any significant degree - that was quite obvious

Of course the Democrats had no problem when Nancy Pelosi
and Biden were doing $3.7 trillion in the “Inflation Reduction Act”

NOW, they’re all freaking out ... THEN, it was all “good” to them

[SaveFerris]

I meant to add - 2008 was just a foreshadowing

COVID-19(84) also destroyed much of the world’s economy

I am NOT happy at all to be mentioning these things - not in the least

[luvie]

Exactly. There has been bad leadership since 2008. Lax, uncaring, on the take. Perfect storm.