The United States’ national debt has been a topic of concern for years, with many experts and policymakers debating its sustainability. One commonly cited metric used to assess the country’s fiscal health is the debt-to-GDP ratio. However, a recent video by Miles Harris critically examines this measure, arguing that it is a misleading and incomplete metric for assessing the country’s true fiscal situation.
The debt-to-GDP ratio compares the total national debt to the country’s Gross Domestic Product (GDP), which is the total value of goods and services produced within the economy. While this ratio may seem like a reasonable way to gauge a country’s ability to manage its debt, it is fundamentally flawed. GDP is not equivalent to government income or cash flow, and thus cannot be used directly to service debt. In other words, just because the economy is producing a certain amount of value, it doesn’t mean that the government has the revenue to pay off its debts.
A more relevant metric for assessing fiscal health is the debt-to-income ratio, which compares the national debt to actual government revenue. This ratio reveals a far more precarious fiscal situation for the United States. According to the video, the U.S. owes roughly 7.5 times its annual income, a level that would be considered deeply unsustainable in any standard credit analysis framework. This staggering ratio highlights the country’s dire fiscal situation and raises concerns about its ability to meet its financial obligations.
The video also highlights the growing interest burden on the U.S. debt, which is nearing 19% of government revenue. This is considered close to crisis territory, as interest payments are the fastest-growing item in the federal budget. The situation is further exacerbated by short-term debt maturities that reset at higher rates, increasing deficits and reinforcing a vicious cycle of borrowing and interest growth.
While sovereign nations with monetary authority can technically print currency to meet their obligations, this does not eliminate fiscal stress. Unfunded liabilities such as Social Security, Medicare, and federal pensions pose a significant threat to the country’s fiscal health. These unfunded promises, estimated to be between $73 trillion and $162 trillion, create a structural imbalance since spending on these programs grows faster than revenue, ensuring that deficits will widen, not shrink.
The video urges a shift from the comforting but flawed debt-to-GDP narrative to a more rigorous analysis based on actual government income, interest burdens, and unfunded liabilities. It concludes that U.S. solvency is currently maintained only through inflation, financial repression, and socialization of losses, rather than sound fiscal management. The crucial question posed is how creditors might respond if they demand stricter conditions on further borrowing, emphasizing the need for public awareness and preparedness around these fiscal realities.
The video by Miles Harris offers a sobering analysis of America’s national debt and the flawed metrics used to assess its sustainability. By examining the debt-to-income ratio, interest burden, and unfunded liabilities, it becomes clear that the country’s fiscal situation is more precarious than commonly thought. As we move forward, it is essential to shift our focus from comforting narratives to a more nuanced understanding of the country’s fiscal reality. We must be prepared to face the consequences of our current fiscal trajectory and demand sound fiscal management to avoid a potential crisis.
For further insights and information, watch the full video by Miles Harris, which provides a detailed analysis of the issues discussed in this blog post. It’s time to confront the dark truth behind America’s national debt and work towards a more sustainable fiscal future.
Advertisement
______________________________________________________
______________________________________________________
If you wish to contact the author of a post, you can send us an email at voyagesoflight@gmail.com and we’ll forward your request to the author. If you have any questions about a post or the website, you may also forward your questions and concerns to the same email address.
______________________________________________________
All articles, videos, and images posted on Dinar Chronicles were submitted by readers and/or handpicked by the site itself for informational and/or entertainment purposes.
Dinar Chronicles is not a registered investment adviser, broker dealer, banker or currency dealer and as such, no information on the website should be construed as investment advice. We do not support, represent or guarantee the completeness, truthfulness, accuracy, or reliability of any content or communications posted on this site. Information posted on this site may or may not be fictitious. We do not intend to and are not providing financial, legal, tax, political or any other advice to readers of this website.
Copyright © Dinar Chronicles
