Your theory falls apart when the interest payments have to be made to foreign entities.
California, TX, and many many municipalities are walking corpses and have been for years. In reality they all are bankrupt… it is simply a matter of defaulting then liquidating, then resetting to a different reality that the level of services provided, pensions, obligations etc simply will have to match revenue.
Eventually we will all learn that we have to live within our means. Either we learn it and implement it ourselves or eventually defaults will humble us as a nation. Maybe in a few years, maybe in 20 years.
It is a simple fact. You cannot spend more then you make. Eventually it all catches up. These trajectories are not sustainable at any level of taxation.
