Part 6/12:
While the idea appears sound in theory, real-world complexities complicate this narrative. Even with improved growth, our current debt trajectory indicates that deficits will not decrease; instead, they will double in the coming years, reaching $4 trillion by 2028. This is largely due to the escalating costs of servicing debt and the unintended consequences of expansive fiscal policies.
For example, if automation and AI-driven productivity were to dramatically alter the employment landscape, the government’s revenue base—primarily reliant on income taxes—would suffer. Estimates suggest that massive unemployment—potentially up to 20% in white-collar sectors—could result from rapid AI deployment.