Can the U.S. Just “Grow Out Of” the Deficit?

No we won’t! We’ll print our way out!

As if Washington didn’t have enough debt, now we have a war, too. And of course America funds its modern wars by printing money.

So now the visible national debt is $39 trillion… and rising fast. The hidden debt, off the books, is at least $100 trillion dollars.

So what is to be done?

For at least two generations politicians have been telling us that we can grow our way out of it. By that they mean if the economy grows at a furious rate, the growth will increase the tax base and make our total indebtedness as a percentage of our productivity shrink.

Sorry. No. Won’t happen.

Here are a few examples from the “we’ll grow our way out of it” choir:

Congressman Jack Kemp, 1988: “I want to suggest here tonight that we can grow our way out of the deficit.”

Senator Rick Scott, 2023: “The dirty little secret in Washington is this – we can grow our way out of debt, and we can protect Social Security and Medicare at the same time.”

Treasury Secretary Scott Bessent, 2025: “We can both grow the economy and control the debt… If we change the growth trajectory of the country, of the economy, then we will stabilize our finances and grow our way out of this.”

So here’s David Stockman, Reagan’s budget director, responding to the happy talk:

This is why I quit the Reagan Administration in July 1985. The supply-side charlatans were wrong then, and have been consistently, dangerously and risibly wrong ever since. You do not grow your way out of massive debt……you budget cut your way out and let growth take care of itself. If you get some extra growth from the 1.8% real GDP trend of the last several decades—it’s a bonus contribution to living standards on main street and slightly less mountainous debt in Washington.

Of course Stockman is right. But budget cutting our way out of the problem is simply not an option. Politicians are adverse to budget cutting since that means buying fewer votes. It doesn’t matter if it’s budget cuts in welfare, war spending, crony subsidies, bank bailouts. Politicians of both parties are terrified of budget cuts and fewer votes.

What alternative remains to the Deep State Money Manipulators faced with deficit-financed spending, rising debt, and as the situation grows even more critical, rising interest rates? What can they do?

They can print money. That is why the Fed is called “the lender of last resort.”No matter how big the debt problem, the Fed can print money, ruining the purchasing power along the way.

But don’t take it from us. Here is former Fed Chairman Ben Bernanke. ““The US government has a technology, called a printing press, that allows it to produce as many dollars as it wishes at essentially no cost. Under a paper-money system, a determined government can always generate higher spending and, hence, positive inflation.

Good thing there’s gold for wealth protection. Especially as we’re entering the end game.

They can’t print gold.