Governments sometimes get themselves into trouble with too much debt. Early economist Adam Smith devoted the last chapter of his famous Wealth of Nations (1776) to the topic of sovereign default. “The progress of the enormous debts which at present oppress, and will in the long-run probably ruin, all the great nations of Europe, has been pretty uniform,” Smith wrote. “The practice of funding [financing deficits with debt] has gradually enfeebled every state which has adopted it.” Read More ›
For a country like the United States, with debt denominated in a local currency, "going broke" normally means that continued deficit spending can't be financed by the bond market. Governments could, at this moment, reduce spending dramatically and basically balance their budgets. Of course this never happens. Read More ›
In air combat over enemy territory, when the fighter plane encounters flak, the pilot knows he is over the target. The American people can be sure that the Department of Government Efficiency (DOGE) that was reactivated by Trump is over the target. Read More ›
