Debt

The US debt as a percent of GDP is now at 120 which is the highest since WW 2. During the cold war years the debt stayed under 70% of GDP but starting in 2008 there was rapid rise going from 70% to 120% today. One of the big concerns is the interest on the debt which was $400 billion per year until the mortgage crisis in 2008 and it has rise to $900 billion last year. We now spend more money on interest than on defense. In 2000 the debt was $5.6 trillion and today it s $36 trillion. How long can this continue. Japan has a debt to GDP ratio of 260% so there appears to be room for increasing the debt. The way out of this mess is to limit future government spending to one percent less than the inflation rate. For example. If inflation over the next 75 years is three percent the $27 trillion dollar GDP will rise to $247 trillion. If government spending is held to two percent the debt will increase to $158 trillion which will be 63% of GDP which is where it was during the post war years. It doesn't matter what numbers are used as long as the increase in spending is less than the inflation rate the debt will slowly come down. Since 1950 the government has increased spending faster than the inflation rate. The average inflation rate since 1950 has been 3.5% while the increase in government spending has averaged 6.8% and thus the increasing debt. The least painful way to reduce the debt is long term. You don't have to cut anything you just have to increase at a slower rate.