Nothwithstanding the debt-fueled government spending binge, the US economy is in big trouble, as our debt has risen to unsustainable levels and Congress appears to have no ability to stop adding to that debt by huge annual deficits. The chart below shows how the official projections in each year about the level of debt have consistently understated the subsequent reality. The pandemic became an excuse to really alter the trajectory. I have no hope that this will be seriously addressed, but if it isn’t the chart that should really concern people is the one showing the proportion of the annual federal budget taken up by interest expense. We could fix the deficit immediately with a few simple steps. Raise the age of eligibility for both social security and Medicare. Impose a work requirement to receive Medicaid. Force a complete review of all those on social security disability to weed out the very large fraction of malingerers. Stop spending on crazy climate bullshit and subsidies. Remove impediments to economic activity, especially in the energy sector. Eliminate private foundations, which only benefit the extremely wealthy and impose a one-time tax on their assets at at least the 50% level, with the proceeds going to debt reduction. Go to a progressive, but flat tax in terms of eliminating different treatment of different income sources, and eliminating all deductions and credits other than one for children. It isn’t hard. A little painful, but overall extremely beneficial for the country.
The second chart shows what happens when you have hears of pro(re)gressive Dem governance of a state versus rational Republican governance. Today’s Wall Street Journal has an editorial demonstrating this in even more detail. But what you see below is an example of how Florida has completely caught up with and is now surpassing New York in economic performance. This gap will grow even more rapidly as wealth and businesses, particularly in the financial sector, moves specifically from New York to Florida. Miami is becoming the new finance center of the country. People and income in this country are voting with their feet to live in states that actually try to improve the quality of life.