Part 6/9:
The Committee for a Responsible Federal Budget has warned that Trump's proposed policies could eventually escalate the deficit to a peacetime record of 10% of GDP—an alarming forecast. Such steep increases in borrowing costs would heighten the difficulty of servicing existing debt, which is already consuming a substantial $1 trillion of taxpayer dollars in 2024, equating to roughly 15% of federal spending.
Potential Resolutions: Paths Forward
There are three primary avenues to address this fiscal predicament:
- Sovereign Default: The least likely option, wherein the U.S. outright refuses to pay its debts. This scenario is improbable due to multiple considerations.