The uncomfortable reality is that fixing this will require tax hikes AND spending cuts. Not just taxes on people you don't like and spending cuts on niche programs, real changes like a VAT and slashing the VA.

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newtonianrules 15 hours ago | parent | next [-]

That would have been the fix a decade ago, the debt is too high now and the economy too weak.

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NewJazz 15 hours ago | parent | prev [-]

Both of which can trigger recessions.

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spelk 14 hours ago | parent [-]

Not paying back US debt triggers a global depression.

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NewJazz 14 hours ago | parent [-]

If e.g. taxes are raised, and GDP decreases, it is theoretically possible that net revenues decrease even though tax rates have increased. Or, revenues may increase but the debt to GDP ratio still increases (because the lower GDP) and borrowing costs increase as a result.

Note that this means, to me, we need to get our shit together sooner instead of later. A little austerity now may prevent outright default later when significant austerity is forced.

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mgh95 13 hours ago | parent [-]

The most effective way is likely not broad-based cuts but targeted cuts to old-age spending via means-testing to induce liquidation of 401(k)s or other savings or tangible property to pay for their own care. I feel the longer (and slower) this trainwreck proceeds, the more likely this outcome is palatable. Roughly 52% of retirees have 250k or more in savings [1]. It is far preferable to drawdown those prior to either cutting benefits or raising taxes.

[1] https://www.aarp.org/money/retirement/peak-boomer-readiness/

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NewJazz 12 hours ago | parent [-]

Fyi asset testing and means testing are different, but yes that is absolutely a good way to implement things from a utilitarian perspective. From a political perspective... Old folks vote. It is a tough situation.

	▲	mgh95 12 hours ago \| parent [-]
		Assets are for practical purposes means and when relatively comfortable retirees draw on SS/401(k)s it is income. There are broadly two choices for the wealthy retirees: 1. cut back on SS and other benefits you can afford out of pocket 2. tax your income higher I would wager they would choose 1. To this group, the taxes hurt worse than the benefit losses For poor retirees: 1. cut benefits 2. don't cut benefits I would wager they would choose 1 The other two commonly suggested fixes -- tax the wealthy and broad tax increases -- also fail in my opinion. The holes we are talking about are in the hundreds of billions per year and won't be fixed by taxing just the wealthy. A broad middle class tax increase will also likely be rejected as unpopular. It really is my belief that a slow-motion failure here is best. If any fix occurs as the social security trust fund is at 0 cash and while the bond market is in revolt, there will be no fiscal room to maneuver to raise cash from the debt which forces rationing.