Sometimes a person says something so outrageous that you know instinctively that they are lying.
Now, to be fair…because I am…I have learned to test my “instinct” before spouting off. Yup, let’s review Trump’s latest economic statement and then let’s see how outrageous it is.
On Friday, August 21, 2026, during a press gaggle at Joint Base Andrews, immediately before Trump boarded Air Force One, a reporter asked him specifically:
“The national debt, as you know, it surpassed $40 trillion. Have you been discussing what to do about that?”
Trump responded that it had been a problem for 35 years, then said the U.S. has “tremendous growth,” that debt is addressed through growth, and that “we’ve never had growth like we have right now.” He concluded, “The growth will take care of that very easily.”
Really? Well, this is an easy one to test for truth vs lie. Ready?
>> First Trump claim: U.S. has tremendous growth.
Reality: U.S. economic growth is stated in terms of real GDP. Current US real GDP growth is 1.5%. For the last 26 years GDP growth has averaged 2.2%. Current GDP growth is 32% BELOW the 26-year average. That is terrible, not tremendous. Under Trump GDP growth has fallen 37.5%.
Claim Result: Big Lie!
>> Second Trump claim: We’ve never had growth like we have right now.
Reality: Current US GDP growth is 1.5%. GDP has been tracked for 96 years. The 96-year historical average is 3.3%. Current growth under Trump is 54% BELOW the historical average. The GDP growth for 75 out of the 96 years has outperformed Trump’s current GDP growth.
Claim Result: Big Lie!
Note: To be fair…In February, Treasury Secretary Bessent thought 2026 growth could be over 4%. By April he had backed that down to saying growth could exceed 3%–3.5%. It now stands at 1.5%. Let’s say Bessent turns out to be right…that still leaves GDP growth at dead average. At his projection/prediction GDP growth would still have been outperformed about 44 out of 96 years. Pathetic.
Updated Claim Result: Still a Big Lie!
>> Third Trump claim: The growth will take care of that very easily.
Question: Here’s where Trump speaks in a weird language…what does he mean “…take care of that…”? It could realistically mean only one of two things –
- Pays off the national debt.
- Makes the national debt more serviceable.
Let’s test #1 –
Reality: The federal government currently collects about 17.5¢ for every $1 of GDP. For economic growth alone to generate $40 trillion in additional federal revenue, GDP would have to grow from roughly $32 trillion to $261 trillion — an increase of more than 700%.
And that assumes every additional tax dollar goes toward the debt.
Result: Impossible!
Let’s test #2 –
Reality: Even if the national debt never grows another dollar and interest costs never increase, at Trump’s current 1.5% growth rate it would take about 47 years to cut the debt-service burden in half.
Result: “Very easily?” Only if you consider half a century easy.
>>>>> Summary of Trump’s August 21st statement on economic growth and debt.
- Overall Claim Result: Big Lie!
- Or, if I wanted to be a bit more kind and gentle…an extremely gross misstatement of facts.
- Okay…a lie.
Some additional information on paying off the national debt, which is now well over $40 trillion.
Inflate it Away –
There is another way to make $40 trillion easier to take care of — inflate it away. Pay yesterday’s debt with tomorrow’s cheaper dollars. That’s inflation taking care of it.
Want to cut the real burden of the debt in half over 30 years? Fine. At roughly 2.34% annual inflation, it works. The nation’s $40 trillion debt effectively becomes $20 trillion.
But there is a terrible downside…your current dollar effectively becomes tomorrow’s 50¢ in the process. Meaning, $1 today becomes about 50¢ of purchasing power in 30 years. So for a family:
- $100 groceries → about $200
- $50,000 car → about $100,000
- $400,000 house → about $800,000
- $50,000 cash savings → purchasing power of about $25,000
That is devastating to an American family while reducing the national debt by 50%. Call it what it is…economic ruin economically devastating in practical and realistic terms. Does that sound like something you want?
Pay it Off –
There is only one way to realistically pay off the national debt…and it is pure fantasy. Increase income and reduce expenses…and pay the debt off. That’s it…not complicated…but fantasy nonetheless.
So let’s make paying off the national debt in 50 years the goal. Current interest on 30-year Treasury Bonds is 5.27%. And you are going to pay it off by increasing revenue by 50% and reducing expenses by 50%. Does that sound like a reasonable plan? It’s called the 50/50/50/5.25 Plan.
Well, this is how it would work out…
- $4.2 trillion a year total in budget changes
- $2.1 trillion in new taxes…75% increase in federal income tax revenue
- $2.1 trillion per year cut in federal spending.
My three questions are these:
- Could politicians keep their hands off an extra $2.1 trillion in additional revenue?
- Could politicians find $2.1 trillion in budget cuts?
- How would you like the federal government to collect 75% more in individual income taxes?
And there is one final really nasty aspect of actually paying off the national debt by increasing revenue and reducing spending…recession.
We’re not talking just a little recession blip…this would be a very nasty recession. How bad?
Let’s say that today we implemented a national debt payoff plan…the 50/50/50/5.25 Plan…or something similar. Here’s what happens…
- Probability of recession: 95%+
- Most likely recession begins: April 2027
- Likely-severe real-GDP peak-to-trough decline: 4%–8%
- Unemployment peak: 8%–10% (approximately 8–10 million losing their jobs)
- Stocks/401(k)s crash potentially: −20% to −35%
So it wouldn’t be a Great Depression but it would certainly be a Desperate Recession.
Summary –
Paying off the $40 trillion US national debt would absolutely require a different American political culture. It would take no deficit spending, very large tax increases, large budget surpluses, and those surpluses applied directly to the national debt.
Even making the US national debt an easier burden would require sustained elimination/reduction of deficits, spending restraint, and/or increased revenue over many years.
Here’s the bottom line to all of it:
- Trump didn’t speak the truth…or even close to it.
- There is no feasible/realistic way to pay off the US national debt.
- While it is possible, it is economically painful to make the US debt burden easy. But honestly, I don’t see it being politically plausible.
- We really don’t know what the end result is going to be as a result of our horrible fiscal policies. History tells us…it won’t be good…not good at all.
But I would like to see one thing change in Washington…
STOP LYING TO US!
