The U.S. economy has been praised for its growth, but a closer examination reveals a more troubling reality. The so-called “exceptional” growth is being fueled primarily by massive government spending and consumer spending on healthcare. In fact, these two factors accounted for a staggering 53% of the GDP growth in Q3 2024. This means that the world’s largest economy is being driven by debt and illness—a situation that is far from sustainable.
Federal spending has continued to rise, significantly contributing to the GDP. In fiscal year 2024, the U.S. government spent $6.75 trillion, resulting in a deficit of $1.83 trillion. This marks one of the largest budget deficits in U.S. history, driven by increased spending on social security, healthcare, and interest on debt.
Consumer spending on healthcare has also surged. As of early 2024, healthcare costs are growing at a faster rate than in recent years, with annual growth in health services spending now higher than before the pandemic. This increase in spending is partly due to rising prices and workforce shortages in the healthcare sector.
Inflation remains a persistent issue, with the annual inflation rate hitting 4.8% in December 2024. This is above the Federal Reserve’s target of 2%, and the rising costs of goods and services continue to strain American wallets. Despite some improvements in wages, the overall economic picture remains bleak.
The concentration of wealth among the top 0.1% has also grown significantly since the pandemic. In 2024 alone, billionaire wealth surged by $2 trillion, with the number of billionaires rising to 2,769. This ever-growing concentration of wealth highlights the widening gap between the rich and the poor, with the top 1% owning nearly 45% of all wealth.
Housing affordability has become another major concern. By the end of 2024, a homebuyer needed to earn an annual income of at least $116,782 to afford a home. This is a stark increase from previous years, driven by rising home prices and interest rates.
Just six months ago, legacy media was celebrating the end of inflation. Now, they’re sugar-coating the situation until they can pin it on Trump. The reality is that the concentration of wealth among the top 0.1% has been going vertical since the pandemic, and the economic growth we see is built on a foundation of debt and healthcare spending.
Sources:
https://www.visualcapitalist.com/breaking-down-the-u-s-governments-2024-fiscal-year/
https://fiscaldata.treasury.gov/americas-finance-guide/federal-spending/
https://www.zawya.com/en/economy/global/billionaire-wealth-surges-by-2trln-in-2024-ux89kese
https://homebuyer.com/learn/first-time-home-buyer-mortgage-relief-credit
https://x.com/Mayhem4Markets/status/1881671870082404576
https://x.com/unusual_whales/status/1881682406677074026
https://x.com/profstonge/status/1881695744807321996
https://x.com/GlobalMktObserv/status/1881696500004061555
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