IMF: U.S. Continues to Stand Out with Growing Debt
The United States ranks number one among advanced economies in expected increase of debt as a percentage of Gross Domestic Product (GDP) according to the latest estimates by the International Monetary Fund (IMF). While we already knew the national debt was on a rising, unsustainable path, these projections show how the U.S. largely remains an outlier in projected increases over the next few years.
The IMF recently released its five-year projections for 2019, which show the U.S. among just four countries with advanced economies with projected increases in debt over the coming years. The data show the projected change in net debt (gross debt minus financial assets) held by advanced countries as a percentage of their GDP. Most countries will actually see a decline in debt as a percentage of GDP over the next five years.
Net debt in the U.S. as a percent of GDP will rise 11 percent according to the IMF. The only other countries to see even small increases are Japan, Korea, and Italy. While Japan and Korea will both see a less than 3 percent increase and Italy is expected to see an increase of only 6 percent, the U.S. is expecting an increase of nearly double those projections. All other advanced countries will see a reduction, and some such as Germany will see reductions as high as 10 percent.
Our political leaders must face the unfortunate reality that we are currently on an unhealthy fiscal trajectory, and America is in desperate need of a fiscal diet.