The International Monetary Fund issued a bold and stark warning to governments around the globe. If these governments want any hope at all of surviving the next global economic recession, they had better get their debt under control.
While the financing of the debts held by governments is not a huge problem currently, that could change at any time. Any economic downturn in which the general population stops making as much money could present a problem for governments, as they rely on theft to maintain their existence.
According to Market Watch, public debt ratios are now “significantly higher” than before the global financial crisis across the globe, and governments need to get their fiscal houses in order ahead of the next global downturn, the International Monetary Fund said Wednesday. “Fiscal policy needs an upgrade,” said Victor Gaspar, director of the IMF’s fiscal affairs department, at a press briefing after the release of the latest fiscal monitor report.
But there’s no way any government will get their spending under control. Doing so would require a relinquishment of power and control over the people they steal from and extort. Once in power, it’s not given up willingly.
At the end of 2017, the total public and private debt reached a whopping $184 trillion or 225% of global GDP. While this debt crisis is upon us and as expected, no amount of warning will get politicians to cut back or reign in their ridiculous spending. In fact, most Democrats running for a position of political power over others want to increase the debt astronomically by adding additional spending, such as the Medicare for All plan.
Advanced economies have levels of public-debt-to-GDP ratios that are close to unprecedented in peacetime, the IMF said. While individuals are also saddled with a heavy debt burden, everything seems smooth for right now because of the interest rates. The low interest rates are helping to make it easier to finance these high debt levels, so governments and individuals continue to pack on more.
“Financial conditions are volatile and they can turn abruptly,” Gasper noted. “There is no scarcity of financial crises. The risks associated with the rollover of high levels of public debt have not gone away and those are the risks that we believe finance ministers would be well advised to manage carefully,” he added according to Market Watch. “In this environment, fiscal restraint is generally recommended,” Gaspar said.
This massive public debt endangers the pensions and retirement promises as well as the jobs of those who currently work for any government. It could cause a major problem and be wholly impactful during the next recession, and the IMF is keenly aware of this.
Debt is a slippery slope and one small move can crash the entire debt-based system. There is no possible way for everything that is owed to be paid back, nor will the government and their enslaved minions agree to financial cuts necessary for an economically sustainable future.