Government Debt, at All Levels, Reaches Post-World War II Levels

[The Straight Story]

Government Debt, at All Levels, Reaches Post-World War II Levels


The United States has reached a level of combined government indebtedness not seen since the end of World War II, when the federal government borrowed heavily to fight a two-front war in Europe and the Pacific. Nowadays, the U.S. debt is serious at all levels, from Washington to state capitols to local governments.

The post-WWII federal debt was nearly 108% of the gross domestic product (GDP), meaning it was larger than the entire U.S. economy. State and local governments hardly had any debt then, but now they have helped push the total U.S. debt (feds included) to 85% of GDP...not counting the money the federal government owes to the Social Security Trust Fund.

While there might be some solace in knowing the percentage is smaller than it was in 1946, the prospects for lowering the debt are weak.

The U.S. was able to pay off a sizeable chunk of the post-war national debt by the early 1950s because it had a young, hungry labor force, growing manufacturing operations, high personal savings and a pent-up demand for consumer goods

http://www.allgov.com/Where_is_the_Money_Going/ViewNews/Government_Debt_at_All_Levels_Reaches_Post_World_War_II_Levels_110225

[Kennah]

1. Tax rates were also a lot more progressive

[arbusto_baboso]

2. Of course. We've been running a wartime economy for decades now.