It’s an old story, but it’s getting worse and so ignoring the 800-pound elephant in the room is getting tougher by the month.
Deficits and debt are mounting and changing the trend won’t be easy. We can debate if the U.S. will muster the intestinal fortitude necessary to even slow the pace of red ink’s ascent, much less reverse it. But in terms of absolute and relative levels of debt on the country’s balance sheet, the future looks assured, as a growing chorus of observers warn.
That includes a fresh advisory from the St. Louis Fed. The title says it all: Deficits, Debt and Looming Disaster: Reform of Entitlement Programs May Be the Only Hope. “For the fiscal year 2008, the federal government’s deficit totaled $455 billion, the largest ever for a single year,” Michael Pakko, an economist at the bank, writes. “In the final days of the fiscal year, which ended Sept. 30, the total federal debt rose above $10 trillion for the first time.”