America’s Debt Math Is Getting Ugly

The U.S. government is on track to spend $7.4 trillion this year, including more than $1 trillion in interest on the national debt. Social Security accounts for roughly $1.6 trillion, with Medicare not far behind at $1.2T. On the revenue side, taxes generate about $2.7 trillion, while payroll taxes bring in roughly $1.8 trillion. The result is a staggering $1.8 trillion deficit. So, how do we keep funding this level of spending? A household or company running deficits like this would eventually face bankruptcy. The U.S. government needs to find another option such as raise taxes or try to “grow” its way out of debt. Good luck AI.

Source: JPMorgan’s Guide to the Markets

This graph was produced by Lucas Juery, CFA, CFPⓇ and is not intended to provide financial advice.