⏩💳 How faster growth can offset America's debt problem. Really.

Well, that in addition to making us all a lot richer

Item: Jeff Bezos, Larry Fink, and Donald Trump’s Treasury pick Scott Bessent all agree: Turbocharging economic growth is the best route to reining in the US’s massive $36 trillion debt. History is not on their side. Bessent warns that this is the “last chance” for the country to grow its way out of the record debt without becoming a “European-style socialist democracy.” Fink, who heads the world’s largest asset manager, BlackRock, urged the incoming administration in an Election Day op-ed to promote artificial intelligence and infrastructure investments to grow the economy and tame the deficit. And Amazon founder Bezos told economic power brokers at the DealBook Summit this month that the only way to solve the problem is to expand the economy by three to five percent a year while simultaneously trimming annual deficits. - “Trump’s ‘explosive’ economic growth claims are no match for the $36 trillion debt,” Politico (12.16.2024)

It's the worst time in a generation — since the go-go 1990s, probably — to dismiss economic acceleration as a realistic path toward fiscal solvency.

Yes, American voters should be absolutely eye-roll cynical when politicians claim they are hardcore debt hawks — and then also say they don’t want to touch major federal entitlement programs (Social Security, Medicare, Medicaid, and health insurance subsidies) while also pushing tax cuts. Reforming those mega-programs can a) reduce what they’re currently expected to spend going forward, as well as b) improve efficiency and effectiveness. We can definitely get more bang for the taxpayer buck. Any serious plan to achieve long-term fiscal stability should reject the status quo regarding entitlements. Full stop.

That said — sorry, Politico and your “history is not on their side” pessimism — we shouldn’t dismiss the idea that economic acceleration can be a massive tailwind in helping debt-reduction efforts. And to be clear, I’m not talking about Singularity levels of science-fictional growth that are 10, 20, or 30 times what modern industrialized economies have achieved in the past.