Soooo... we're currently fighting deflation (presumably). As I've opined before, this kind of spending can only be sustained in one of three possible ways.
1) Higher taxes - Ruinously high. The kind that drive people into the underground economy, (cash, off the books).
2) A miraculous increase in tax revenue due to a booming economy. When this happened during during the Reagan years, the .gov still managed to outspend the increase, thus INCREASING our debt. Curiously, with Reps in power during the Clinton years, fiscal sanity was temporarily achieved. Can this possibly occur with a full-tilt-and-boogie redistributionist in the WH and the same idealogy in control of both chambers of Congress?
3) A repudiation of the debt by inflation or <gulp> hyperinflation. A lot of very savvy people still buy dollar-denominated government securities, betting agains this scenario. Of course, a lot of savvy people lent money to NINJAs(*) as well, sparking the housing bubble.
My views on this were formed by reading authors of the '70s lilke Gary North, Howard Ruff, and Murray Rothbard. North was catastrophically wrong in his catastrophic predictions about y2k, so I am re-examining my long held views on 1, 2, and 3 above. Anybody else got other options or other informed opinions?
(*) NINJA: A person with No Income, No Job, no Assets.