The Administration will officially raise its 10-year deficit projection by close to $2 trillion, from $7.1 trillion to $9 trillion. Yikes! Even by modern inflated standards, that is a staggering sum of money, and it raises an increasingly daunting question: who is going to buy the debt instruments that would allow us to finance that debt, and at what cost? In order to entice investors to accept the risk that the United States might not be able to repay such extraordinary sums, might the Treasury Department have to offer higher interest rates and higher yields, thereby making it even more difficult for the U.S. government to pay off its debt and get back to a balanced budget?
There is no doubt that our country cannot continue deficit spending on this scale. We have to reduce our deficits, and quickly, or we may face a real economic crisis in the very near future.