Gross Federal Debt as a Percent of Actual and Golden-Age Trend GDP

The graph uses annual data, so there is nothing yet for 2023. 

The graph shows the federal debt for 2022 as 121.1% of GDP (blue).

It shows the federal debt for 2022 as 65.7% of what GDP would have been (red) if GDP growth had not fallen behind its 1946-1974 exponential trend.

In other words, if  GDP growth continued at the 1946-1974 rate, the gross federal debt (as of 2022) would be less than 66% of GDP, not more than 121%. (I did not change the Gross Federal Debt numbers.)

I'm not saying the low percentage is realistic. I'm saying it would be realistic if policymakers knew what they were doing and could maintain decent economic growth.

So anyway, all this nonsense about the debt ceiling... but if GDP kept growing at its 1946-1974 trend, our massive federal debt today would be only about half the size it is, as a percent of GDP.

 

People who complain that the federal debt is too big unfailingly offer "percent of GDP" numbers as proof of their claim.

But those same people say GDP growth is too slow and, well, they are right about that. But then to turn around and show the federal debt as a percent of this slow-growing GDP, well, it makes the federal debt look bigger than it really is. So those people are either liars or just plain stupid.

It's not that the federal debt grew all that fast! The federal debt grew, yeah, but not as fast as it looks, because GDP growth has been so slow for so long! As a percent of GDP, the gross federal debt would be only about half what it is today if GDP had maintained its 1946-1974 growth rate.

Hey, here's my spreadsheet, at DropBox.