Going Cold Turkey on Deficit Spending? Congress Would Rather Wait for a Crisis

I have written for many months about the terrifying trajectory of U.S. federal debt. The ever-growing mound of federal debt is pushing the country progressively closer to a breaking point, beyond which investors will stop buying treasuries without demanding ever-higher interest rates to cover the once unthinkable risk of a government default on U.S. treasuries.  According to the Congressional Budget Office (CBO) the national debt is now nearly $37 trillion, and it looks set to balloon to more than $55 trillion over the next thirty years. In fact, a lot of things would have to go very right for the debt level not to be much larger than this projection. Due to the massive trade deficits which the U.S. runs, the nation is highly dependent on a huge, steady inflow of capital from foreign trading partners in order to finance its operations.  If the willingness of foreigners to recycle even a modest percentage of their surpluses into the U.S. declines, then we would be facing a financial challenge that will cascade from bad to catastrophic.  Such a problem would feed on itself, making further investments by foreigners into our capital markets less likely, which in turn would drive domestic U.S. interest rates higher and higher, thereby reinforcing this destructive pattern.