Visualizing Donald Trump's $20 Trillion Problem

Tyler Durden's picture

Only a few days after Trump’s inauguration ceremony, the U.S. National Debt will creep across the important psychological barrier of $20 trillion.

It’s a problem that’s been passed down to him, but, as Visual Caitalist's Jeff Desjardins notes, it certainly puts the incoming administration in a difficult place. The debt is burdensome by pretty much any metric, and the rate of borrowing has exceeded economic growth pretty much since the late 1970s.

How Trump deals with this escalating constraint will be a deciding factor in whether his administration crashes and burns – or ends up re-positioning America for greatness.

Donald Trump’s $20 Trillion Problem

Partisans will squabble about who added what to the mounting debt, but the reality is that none of that really matters. Both parties have kicked the can down the road for the last 40 years, and that has culminated in the current situation:
Debt incurred under each President

Source: The Money Project

Back in 1979, the debt-to-GDP ratio was a modest 31.8%, and the federal government only had an outstanding tab of $826 billion. Fast forward to today, and the perpetual borrowing has added up.

The debt-to-GDP is now 104.2%, with the total debt burden nearing the $20 trillion mark.

US government debt to GDP

Source: The Money Project

In absolute terms, the debt is the highest it has ever been. Using the common measure of debt-to-GDP, the debt is the highest it’s been in 70 years. The last time it soared past the 100% mark was during the final year of WWII.

Granted, the situation isn’t as bad as Greece, Cyprus, or Japan – but it’s getting there:

Debt to GDP

Source: The Money Project

In terms of debt-to-revenue, a measure that compares the national debt to the amount of taxes taken in by the federal government, the U.S. has the 2nd highest debt out of 34 OECD countries:

Debt to Revenue

Source: The Money Project

On a “per person” basis, each person in the U.S. owes $61,300 – the second highest in the world. Per taxpayer, however, that amount balloons to $167,000.

Changing Rhetoric

So what does Trump think of all this debt business? It’s hard to say, because his rhetoric has changed.

At the start of his campaign, he made it clear that debt would be a top issue for his administration. In February 2016, Trump said that the U.S. was becoming a “large-scale version of Greece” and that tackling the debt would be “easy” with a more dynamic economy. In April 2016, he said he could pay off the debt after eight years in office.

This rhetoric aligns with the official GOP platform, which says that the national debt has “placed a significant burden on future generations”, calling for a “strong economy” and “spending restraint” to pay it down.

But since then, Trump’s views may have changed.

His most recent economic plans include $1 trillion in infrastructure and $5 trillion in tax cuts – and they could increase debt by anywhere from $5.3 to $11.5 trillion. He’s also said that the U.S. will never have to default because it can simply “print money”.

How Trump will choose to deal with the debt is a big question – and only time will tell if his actions will make America great again.

 

*  *  *

The Money Project aims to use intuitive visualizations to explore ideas around the very concept of money itself. Founded in 2015 by Visual Capitalist and Texas Precious Metals, the Money Project will look at the evolving nature of money, and will try to answer the difficult questions that prevent us from truly understanding the role that money plays in finance, investments, and accumulating wealth.

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SunRise's picture

Mr. Scott!  Warp Speed!

J S Bach's picture

The debt - whether it be 20 trillion dollars or 2 dollars is not Donald Trump's problem... it's all of ours.  It is an inherent result of the phony usurious system that was set up 104 years ago to enslave us all in the bondage of the international bankers.  We must jubilee ourselves from this horrible fate and reclaim as much of the wealth as we can from those who have perpetrated this upon us.  Whosoever can accomplish this feat will go down in history as one of the greatest statesman and leaders of all time.

Haus-Targaryen's picture

Sounds fine to me.  

Just realize that is the death of every pension and retirement account on the planet, save for PMs held in your possession, and perhaps BTC. 

 

GGuy's picture
GGuy (not verified) xythras Jan 13, 2017 5:48 AM

20 Trillion was not a problem under the half breed Muslim homosexual....

Kotzbomber747's picture

Not to worry Trump fans, he's the orange King of Debt, hahahaha!

NoPension's picture

I voted for Trump.

I stand fully behind him. He's my guy. ( ok, this is starting to sound gay)

By the end of his second term, should he be blessed...

The debt will be in excess of 40 trillion dollars.

We are in the hockey stick portion of the exponential graph. The future is now. In a debt based monetary system, more debt must be created, faster, to keep the wheels on the cart. Sure...the numbers are bizzarro already.
But that's just the way it rolls.

The only way out...Blow it up...and start over. Trump may be "The Guy" for that job.

Government needs you to pay taxes's picture

Jubilee or war or both.  Jubilee could be done in the US based on either an aggregate $ of debt forgiveness per household OR some sort of sliding scale based on income/assets.  Would be fucking hilarious if the 5%ers got zero debt foregiveness whilst Mainstreeters had their mortgages/student loans paid off.

Déjà view's picture

Highest rating by 2/3 of big three agencies...whats a little $19 trillion in debt since Reagan entered office...all FIAT...

Gold/Silver are UNDERVALUED...big time, when properly measuring inflation...Au: $850 (1980)

xythras's picture
xythras (not verified) J S Bach Jan 13, 2017 4:41 AM

There's always Mexico to cough up some dough also:

http://dailywesterner.com/news/2017-01-13/mexico-surrenders-announces-ma...

Krungle's picture

It doesn't sound like an "us" problem--it sounds like a problem for the handful of people who loaned $20 trillion to an entity that spends irresponsibly and without any hope of ever paying it back. If we actually had a leader willing to make the banking class choke on every last penny of bad debt they issued, that would put an end to usury for good. No one is going to get into the usurous loaning business if they get stuck holding a bag of trillions of dollars of monopoly money. It is a drag on economies and our economic theories are all nonsense so long as they are beholden to the idea that a few privileged private people can issue unlimited amounts of debt and that it makes sense for economies to carry around more debt than they can ever pay off via productive economic activities. It is a primitive relic of past centuries that we are carrying around for some inexplicable reason and humans cannot progress until they collectively realize this debt is an accounting fiction. Humans in almost every culture for the majority of human history rejected usury for these very reasons. 

I Feel a little Qeasy's picture

You misunderstand the problem. The banks do not wish the debt to be repaid. Without the debt they would have no 'income' with which to steal from the real economy. They never lent 'wealth' they lent currency, which is printed at almost zero cost, and is then used to steal from the producers of wealth. The interest that they 'earn' (from producing nothing) is used to extract real wealth and assets from the real economy. The LAST thing they want is the debt paid off.

Radical Marijuana's picture

Yes, J.S. Bach, those are the deeper issues, which the article above, and its embedded video, did NOT admit nor address. However, instead of any kind of "debt jubilee," the banksters' "solutions" are much more probably going to be orders of magnitude more mass murders. The only possible resolutions, that could be better, must be better death control systems to back up better death control systems. However, the only ways that those might actually emerge would be through the eruptions of death insanities, that follow from the runaway debt insanities.

President Trump's greatest problem is the threat of being assassinated ... The last time a President successfully fought against the international bankers was Andrew Jackson, who had to almost miraculously survive assassination attempts in order to "kill the (second) bank."

In general:

MONEY IS MEASUREMENT BACKED BY MURDER.

The greatest leverage in that overall situation was gained through the assassination of politicians who otherwise could not be bribed or intimidated. Political assassinations are the single most significant ways that civilization operates according to the principles and methods of organized crime. There is only one political system, and that is organized crime. However, because that is the case, the dominate natural languages and philosophy of science have been shaped to enable the best available professional hypocrites to control civilization through the use of languages and presumptions where were built on the long history of social success based on being able to back up lies with violence, despite that doing so never stops those lies from still being false.

There is now almost nothing but the central core of triumphant organized crime, surrounded by layers of controlled "opposition" groups. The established systems ARE public governments enforcing frauds by private banks, and all other sociopolitical systems have been transformed to adapt to living INSIDE those enforced frauds ... Meanwhile, almost exponential progress in physical science and technology has enabled those enforced frauds to become exponentially more fraudulent.

In particular, in the USA, since 1971, there has been an almost perfect mathematical correlation to exponential growth of total debts in the USA. As long as the already established and entrenched MAD Money As Debt Systems continue to dominate the USA, then the only thing that President Trump could do would be to preside over once again doubling the total debts within those Systems ... since anything else would precipitate the catastrophic collapse into chaos of those Systems.

Indeed, the combined effect of the established monetary and taxation systems can be compared to a totally metastasized cancer, or a parasite that is totally intertwined in its host, such that there are NO treatments which could kill that cancerous parasite without also killing the patient host. Moreover, since there are NO publicly significant genuine opposition groups to the established Systems, but rather, only a variety of controlled "opposition" groups, it appears to be politically impossible for anything else to happen than that those Debt Slavery Systems will continue to generate runaway debt insanities, until those provoke death insanities.

In that context, some old-fashioned notions of "debt jubilee" are too superficial. Instead, there "should" be series of intellectual scientific revolutions, which enable profound paradigm shifts in the ways that the combined money/murder systems are perceived. In the end, there are NO possible solutions to political economy problems that do not operate INSIDE human ecology. However, the underlying political problems are that natural selection pressures have driven the development of artificial selection systems to become most successful by becoming the most dishonest that those could become! Moreover, those enforced frauds are automatically becoming exponentially more fraudulent, as "we" watch and wait to see what eventually happens ???

It is barely possible to exaggerate the intensifying paradoxes that follow from prodigious progress in physical science, WITHOUT progress happening in political science. Rather, advancing technologies are primarily applied to become better at enforcing bigger frauds, with the result that exponentially advancing technologies have enabled exponentially increasing fraudulence, which is the basic big picture presented in the article's summarizing charts presented above.

The laws of nature are NOT going to stop working. However, the laws of nature have driven the laws of men to become more and more based on integrated systems of legalized lies, backed by legalized violence, whose most important forms are the ways that money is a matter of law, whereby public governments enforce frauds by private banks. It is because the most socially successful murder systems were those which became the most deceitful and treacherous that the most successful financial systems became the most fraudulent.

Too much of that kind of success has driven civilization criminally insane.

The previous systems of paper "money" frauds, backed by gunpowder weapons, have rapidly become globalized electronic "money" frauds, backed by the threat of force from atomic weapons. Since the USA has become the heart of that beast, the fate of the combined money/murder systems, of the US Dollar and the US military, will also largely become the fate of the rest of the world. The only reasonably probable foreseeable finite futures for Globalized Neolithic Civilization are for runaway debt insanities to provoke runaway death insanities ...

It is within that context that any "debt jubilee" could be considered ...

MASTER OF UNIVERSE's picture

One must plot a destination with Mr. Checkoff before calling Mr. Scott in Engineering to give you warp speed, SunRise. You will now be placed in Protective Custody in Sick-Bay for 48 hour observation due to your breach of Starship Regulations. You are to remove yourself from the Bridge, and report to Sick-Bay under guard immediately.

Haus-Targaryen's picture

Trump needs to pull the plug ASAP.  The longer he lets this sit and fester, the more of "his problem" it will become. 

He has great experience in bankruptcy and restructuring.  

Dirtnapper's picture

National debt is not the biggest threat, it's the unregulated Derivative Market that's the biggest threat.

JRobby's picture

Shhhh! Not supposed to talk about that.

Big secret.

Cruel Aid's picture

those figures are stupid big, but the sec is all over it. Well actually they are too busy palling around with ponzi schemers to tackle something that hard and dangerous.

not dead yet's picture

As long as the US is the cleanest dirty shirt in the laundry and controls the strings to the financial markets it can print and spend all kinds of bucks and get away with it. To keep on top they will sanction and overthrow governments to create chaos with the suckers buying the US dollar and US financial instruments for safety. When the shit finally hits the fan the US will refuse to pay and cancel it's debts. No need to worry about your kids paying being liable for the debt. The big worry is when the system collapses we will be back to a barter economy with the resulting anarchy and deaths of millions as we all revert back to the stone ages.

Ghordius's picture

excellent graph showing that once, sovereign debt was higher, in the US

there are two ways to decrease debt compared to the economy, the income in taxes

the one is neoKeynesian: grow out of it. growth, growth, growth. this leads particular high priests of this approach to phantasize about Martian Invasions and the destruction of every window pane industry, because it stimulates the economy, it flogs the horse

the other is Austrian: austerity. spend less then the income, in the case of gov less then taxes

this is the one that was used in the first part of the graph. this is the one that was used by the United Kingdom after the Napoleonic Wars. it took them something like 75 years to decrease that sovereign debt from a height that would be (difficult to calculate, mind) around 300% of GDP to something like 60% of GDP. a gentle decrease over many decades. in matter of Great Power politics, a peaceful time, too

the Austrian method is completely reviled because it forces the patient to forego medicine, particularly painkillers

to the point that most people don't even believe that austerity "works". and so disregard the historical fact that it did, many times over

is the US going to spend less then it gathers in taxes? is the US going to increase taxes, particularly on the rich? is the US going to spend less for the military?

those are the key three questions. two yes out of three would be enough. all the rest is fluff, from an Austrian perspective

Haus-Targaryen's picture

The US cannot spend less.  

More than 2/3rds of US government expenditure is considered "non-discretionary" spending.  E.g., the Congress has no power (in theory) to restrict these payments.  The other third is considered discretionary spending, of which half goes to the military, the Department of Education/Environment/insert your worthless government agency here gets the rest. 

Non-Discretionary spending is: 

1) Social Security
2) Medicare
3) Medicaid 
4) Interest on debt

The US is more or less a pension fund with a military.

In 2016, the US government could have cut discretionary spending to $0 and still have run budget deficits.  We are completely screwed.  

The only way out of this is to tell the Boomers they get nothing from the .gov in retirement and they will need to work forever. 

Ghordius's picture

"the US cannot spend less" is... a belief

a very widespread one. constantly propagated by neoKeynesians

the equivalent of the 1) US Social Security has been curtailed in many, many countries. the "best in class" on this matter is - and this is factual - Italy. but even Germany and France did something about it

the 2) Medicare and 3) Medicaid problem is connected to the mess that the US has in all expenses and costs of the "medical setup". utterly solvable. any time. nobody spends as much for so little medical support

meanwhile, nobody spends as much for the military, and nobody has such a huge difference between what the 99% pay in taxes and THE OTHER HALF in terms of wealth/income seen under the lens of taxability, the "1%"

anybody that seriously compared the trajectories of various countries over longer period of times will attest to this

I repeat: you are repeating a belief, here

new game's picture

shrink gov.org by 10 percent. that is the waste. then regoup and do it again. goal is balanced budget, first hurdle.

in the meantyme, haircuts accross the board to bond holders and restructure the mess. any of this will be fought tooth and nail.

conclusion: hopeless dispairing not gonna happen, because, politicians are bot and paid for.

2nd conclusion from first:plan according for worst case witch is guns and roses(for burial).

be happy bitcheez...

CJgipper's picture

That's a false choice.  We can reign in government spending while growing the private sector economy.  That solves the problem.  The real problem here is that we include government spending in GDP which is why your numbers are total nonsense.

Batman11's picture

There is a global debt re-cycling system in place that relies on the US being in debt and running deficits.

We came off the gold standard in 1971 and US treasuries became the only real asset that could be used in place of gold.

The surplus nations, like China, export to the US and to keep this trade running they buy US treasuries so the US can go further and further in debt buying more Chinese stuff.

It’s the way it works.

Michael Hudson “Super Imperialism” tells all if you want to stop reading silly articles like this and worrying about US debt.

It’s the way the world works (for now).

Before this, the US was the global creditor nation and the US surplus was recycled to the deficit nations.

The US’s war loving ways saw if go from creditor to debtor super-power before 1971.

That’s the problem to resolve, a love of war.

Batman11's picture

There is no re-cycling mechanism within the Euro-zone so it is polarising and collapsing.

Greece has gone, the Club-Med nations are not far behind, with France catching up rapidly.

Adios Euro-zone.

Who designed that crock of shit anyway?

Troy Ounce's picture

 

 

Public debt is not the problem. Private debt is, according to Steve Keen. And private debt levels are historically high.

 

Ghordius's picture

from a historical perspective, it matters even more who holds that debt

if it's mostly foreigners is a completely different affair then if it's mostly taxable entities inside of the jurisdiction of the state

note the funny new development of Apple-like stashes of untaxed cash outside the US

note Japan, for contrast

Batman11's picture

Government debt gets rolled over ad infinitum and is not really a problem as everyone pretends it will get paid one day. 

Private debt isn’t like that.

Debt is borrowing from the future.

We got to the future and no one had any money to spend.

The economy died.

 


jus_lite_reading's picture

Exactly. Japan. We need to be moar like them.

Batman11's picture

Indeed, we are sailing in a ship of fools.

Our experts felt they were beyond reproach and tuned into incompetent idiots.

They all think pretty much the same thing and sit in an echo chamber of their own ignorance.

2008 - "How did that happen?"

People like Steve Keen, who saw it coming, are still marginalized.

No one that knows what they are doing can be allowed to sail in the ship of fools.

 

TheVoicesInYourHead's picture

Big question- Where did the $10 trillion in new debt go?

What was newly bought or paid for with the $10 trillion in new debt?

Troy Ounce's picture

 

The US $10T disappread in the banking system to:

1. Keep you and your family alive...just.... and for the time being.

2. To finance the military, oil bribes, kiddie porn extortion, drug  and weapon trafficking and mass shootings courtesy Dyncorp and John McCain. 

Btw. Where IS Eric Braverman? 

https://youtu.be/g-km5K9uOQw

jus_lite_reading's picture

Where is Seth Rich?

Oh shit, right. He's dead. RIP Seth, you're work exposing the DNC was not for nothing! We know...

css1971's picture

Nope. Issue zero coupon, non maturing bonds. Make The Fed buy them.

 

Eventually, over a couple of decades, all existing public debt will be rolled into these bonds at the Fed (who else would buy them?) and the credit spent into the economy. Debt based money will be replaced by credit only.

ronaldwilsonreagan's picture

 

 

This is not Trumps problem, It is the Final Solution. (See Greece) The Debt began with Reagan and has continued to gain Velocity ever sense. Giving Tax breaks to the rich while increasing the debt in the name of our grandchildren yet to be born. We already know Trump plans to reduce taxes on the super-rich while spending more money. It is the same old shit we have seen for the last 30 years with a Piss Clown face. In the end the debt will be used by global elitists to smash whatever belongs to the American people and leave them starving on the very land our fathers fought for. Trump is one of the Global elitists he is not here to rescue anybody but the wealthy. Picture Soros and Trump shaking hands that is the reality not star struck worship the rich cunt, dear trapped in headlights, cult follower’s belief that Piss Clown is our savoir. 

 

T

Cassandra.Hermes's picture

The numbers are incorrect: Obama added $7.917 trillion, a 68% increase, Bush added $5,849 trillion, a 101% increase.

headhunt's picture

So really the +2 trillion 0bama added over bush is nothing.

Everyone would always want an increase of 101% in their paycheck instead of a 68% increase - unless of course you do the math

mayhem_korner's picture

unless of course you do the math

Priceless! 

It's pretty evident that some here don't do math.

jus_lite_reading's picture

BUSH (that NWO crony pig) inherited the CLINTON disaster- the 'give every motherfucker that can write his name on toilet paper a new house' plan. CLINTON set up that whole long term cancer called subprime. You know, cause he had to give the gib me dats some cheddar.

Expat's picture

We need an awesome president like the last one who managed to lower the national debt!  Bring him back!

Let it Go's picture

The so-called Obama recovery was all built on debt! As we move toward President-elect Trump taking office in early 2017  the National Debt Clock is about to breach the 20 trillion dollar mark. The myth that a scenario of growth coupled with a falling deficit will allow us to outgrow many of the problems we face brings with it a false optimism and hope.

The ugly truth many people choose to ignore is that starting in 2017 entitlements will become the driving force that carries the deficit higher and higher into nosebleed territory. More about just how bad this problem is in the article below that points out when Obama took office it was expected debt would stand at 12.5 trillion in 2019. 

 http://brucewilds.blogspot.com/2016/11/national-debt-looms-over-america-as.html

truthalwayswinsout's picture

There is a really simple and easy way to fix the issue. Grow out of the problem.

They only way left to do that is to simply take NASA public. Use the $600-$800 billion raised over the next 10-15 years to invest in new companies to commercialize space. It would pay off the debt, create many millions of jobs, new tech, and companies and save the environment.

Ahhhh but what is the catch you say grasshopper?

The sad part is Trump is too stupid to do it because no one around him understands tech. They understand airports, roads, and buildings but not tech.

So the chance of a life time is going to pass us by.

JailBanksters's picture

Shssh here's the secret, don't tell anyone

To pay back the 20 Trillion all you have to do is borrow 30 Trillion, pay back the 20 Trill + Interest and keep 5 Trillion for later

 

headhunt's picture

That sounds like the GM bailout

It's a good idea though, I think i will payoff my mortgage with this plan.

JailBanksters's picture

All good things come to an end.

The problem is eventually your going to run out of Property to buy, and that's when it falls apart.

MaxThrust's picture

2008 Wall-street got bailed out to the tune of $800billion and main-street got nothing. I say ignor the debt and the banks and focus on mainstreet.

wholy1's picture

Coming up - if "theTrumpster" [and NWO wrecking crew] again "illuminate" what has become the "Dark House" at 1600 TRANSylvania Av:  TREASURY-issued C-U-R-R-E-N-C-Y according to the CONstitutional mandate?