Episode 192: The Anatomy of a Debt Apocalypse

One of David’s jobs as the host of the Power of Zero Show is to constantly remind listeners of the horrifying fiscal outlook the U.S. is facing. This episode looks at components that are contributing to this “fiscal apocalypse”. David Walker, former Comptroller General of the Federal Government, sees the Debt-to-GDP ratio as something worth focusing on. Currently, it’s about 108% – about the same percentage as in the immediate wake of World War II. However, it’s projected that it could increase up to 185% by 2052. Not being able to find a way to live within our means seems to be the root cause of this issue. By 2052, Federal spending will equal 30% of GDP, while actual revenue will remain at about 18% (based on current tax rates). David discusses the cost of servicing the U.S.’ burgeoning national debt – which currently sits at about 1.5% of the country’s GDP but that number is projected to reach 7.2%.  The fact that the Fed has begun increasing interest rates in a historic way has bee...