A new analysis shows what states are risking by reopening too early: A longer pandemic that could kill more Americans and send the national debt skyrocketing
But an extended pandemic would further the economic pain, according to a new report by Deutsche Bank. In a worst-case scenario, the US could see its debt-to-GDP ratio hitting 130% halfway through the next decade and nearing 150% by 2030, the bank found. Either way, the outlook isn't good — these are levels not seen since the mid-1940s, when the debt-to-GDP ratio was 121.7% at the end of World War II.
Both scenarios for 2030 mean that America's debt load could outweigh its revenue. But states reopening early could send the country toward the worst-case scenario, potentially costing taxpayers trillions more in expenditures as the government shoulders a heavy burden to prop up the economy. To be clear, Deutsche Bank notes, the Congressional Budget Office had warned that a 150% debt-to-GDP ratio is coming — but the pandemic pushed the time frame for it forward by a whopping ten-and-a-half years. And,
, an economics research firm, "rather than monitor traditional metrics such as debt-GDP ratios, many economists now believe inflation is the only limit on government borrowing."considers the massive debt load by hazarding a prediction: The debt will never actually come down from this level, and the US will pass the biggest tax increase since the end of World War II while trying to grow GDP to a level that can maintain the debt.
But separate from the issue of what such a debt load means for the US' economic future, early reopenings could also lead to a greater death toll than would result from a longer shelter-in-place period. If all social distancing measures are foregone, another 300,000 Americans could die from COVID-19 than if restrictions remained,
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