> There is no point at which a "death spiral" occurs.
Let's do some simple grade school math. The yield on government bonds, the cost of borrowing, has ranged from 2% to 15%.
To make the math easy while being generous to your claim, let's predict 5% as a long term average. Let's say the debt is 20X GDP.
5% of that is 1 X GDP - everything the country produces goes to pay interest on debt.
When the entire GDP is spent on interest payments, nothing is left for the people to eat, get shelter, education, etc.
Everybody's entire paycheck is sent to China and other creditors. That sounds like collapse to me.
So we've established via grade school math that collapse occurs by the time you reach 20 X GDP. If you can pass
4th grade math, you can see there IS a point where it collapses. The only debatable question is exactly where
that point is.
Those, like you, who advocate for big government spending say that the government needs to spend at least 10% - 30% of GDP
on services and entitlements. That leaves 70% for interest payments, so debt can't be more than 14 X GDP.
Hmm, people need to eat, and pay utilities, etc., so they'll need to keep half of their pay check. To leave people will
half of their paycheck, that's a max of 7 X GDP for government debt. This is still basic arithmetic and we've seen that
anything above 7 X GDP collapses. We could get a more specific number by doing advanced things like decimal division,
but I think the point is clear - there absolutely is a point of collapse, and with the debt doubling every 8 - 10 years, it
won't be long before we hit it.
> Post WW2, Britain had a 220% debt to GDP ratio. Post WW2, the US had a 121% debt to GDP ratio. Both countries were fine.
It's arguable whether the US is "fine", Obama says it's "definitely NOT fine", but you're confusing a one time event with a habit of chronic over spending. WWW2 was a one time event, like buying a house. What we have today is chronic, permanent overspending every single year - like a person
who makes $5,000 / month and spends $7,000 / month every single month.