In this episode of Gross Domestic Problem, William Glass talks with professor and former regulator Jill Cetina about the hidden “plumbing” of the financial system and how policy since 2008 has reshaped risk. They unpack how quantitative easing (QE) worked, why the Fed’s balance sheet exploded, and how QE inflated asset prices, especially housing, while quietly creating banking vulnerabilities through uninsured deposits. Cetina argues that aggressive quantitative tightening (QT) now risks new bank stress, especially in a stagflation scenario where inflation stays high as growth and employment weaken. They explore how energy shocks and potential oil spikes could fuel stagflation, why America’s rising debt and unfixed entitlement promises are pushing us toward fiscal dominance, and how stablecoins and nonbank finance can drain deposits from banks and crowd out real-economy lending. The key takeaway is that the current mix of monetary and fiscal policy is accumulating systemic risk, and younger and mid-career generations need to engage politically, professionally, and by building real-economy businesses and families, if they want the “deal” of the American Dream to remain viable.

Key topics in today’s conversation include:

• Introducing Professor Jill Cetina & the Core Question: “Is the Deal Still Real?” (3:32)
• What the Fed’s Balance Sheet Does & How QE Began in 2008 (8:04)
• QE’s Side Effects: Codependency with Fiscal Policy (10:26)
• Housing Affordability Crisis, 3% Mortgages, and “Locked-In” Homeowners (13:32)
• Asset Inflation Beyond Housing: Stocks, Tech, and the AI Boom (15:53)
• Jill’s Sharp Critique: Why Current QT Thinking Is Dangerous (17:52)
• Critique of “Use the Discount Window Instead of Keeping Liquidity” Idea (20:44)
• Introducing Stagflation: Weak Growth + Sticky Inflation (24:47)
• Three Vectors of Recession Risk: Oil, Falling Assets, Private Credit Stress (29:30)
• The Fed’s Policy Shift: Tolerating Higher Inflation Post-COVID (33:16)
• Why Extending Fed Liquidity to Nonbanks & Stablecoins Is Dangerous (35:59)
• Defining Fiscal Dominance and How It Warps Policy & Regulation (47:42)
• AI and Productivity: Why Counting on a Tech Moonshot Is “Nonsense” (50:06)
• Stablecoins Draining Bank Deposits to T‑Bills = Government Crowding Out (54:26)
• Why Congress Focuses on Crypto Instead of Fixing Fiscal Policy (57:08)
• Generational Power Imbalance and “Gambling for Resurrection” (1:00:41)
• Investing in the Real Economy: Building Useful Businesses (1:05:51)
• Family Formation as a Real (Non‑Financial) “Asset” for the Future (1:05:06)
• Closing Thoughts and Mutual Thanks (1:06:12)

Gross Domestic Problem is a podcast from Millennial Debt Foundation focusing on America’s biggest financial crisis. Each episode, we break down how we got here, what happens if we don’t act, and the least painful way forward. There’s no do-nothing solution. Subscribe now at grossdomesticproblem.com and join the conversation.

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In this episode of Gross Domestic Problem, William Glass speaks with Congressman Lloyd Smucker about America’s growing national debt, the bipartisan resolution to reduce the deficit to 3% of GDP, and what fiscal stability means for the country’s future. Smucker shares his journey from an Amish upbringing and 17-year-old business owner to Congress, explaining how running a company shaped his views on government spending and regulation. They unpack why the 3% target was chosen, the difference between stabilizing and eliminating debt, and how high deficits crowd out private investment and drive interest costs above core priorities like defense and Medicare. The conversation highlights the risks of a potential sovereign debt crisis, the looming Social Security trust fund shortfall, and the links between fiscal policy and national security. Key takeaways: the debt problem is serious but still solvable if tackled gradually, it will require bipartisan commitment and public understanding, and doing nothing virtually guarantees lower prosperity and reduced strategic flexibility for future generations.

Key topics in today’s conversation include:

• How Deficits Became Normal Outside of Crises (0:57)
• Introducing the 3% of GDP Deficit Target & Resolution (1:34)
• Congressman Lloyd Smucker’s Background & Amish Upbringing (2:27)
• Becoming a 17-Year-Old Business Owner & Living the American Dream (4:30)
• How Regulation and Government Growth Pushed Him Into Politics (6:04)
• Why Builders and Business Owners Become Fiscal Hawks in Congress (8:31)
• Who the Audience Is: Entrepreneurs in the “Squeeze of Life” (9:43)
• Why Aim for a 3% Deficit Target Instead of a Balanced Budget (11:34)
• Post–World War II Debt History and Gradual Debt Reduction (13:37)
• Empires, Debt, and the Risk of Losing U.S. Dominance (17:47)
• Sovereign Debt Crises: “Gradually, Then Suddenly” (21:13)
• The Limits of Targets Without Enforcement & “Teeth” (28:32)
• Fiscal Commissions, Public Engagement, and Building Bipartisan Will (30:39)
• Entitlements as the Main Drivers: Social Security, Medicare, Medicaid (38:24)
• Social Security as a “Math Problem” That Can Still Be Fixed (40:24)
• Debt, Fiscal Space, and U.S. National Security Risks (42:05)
• Why U.S. Military Strength Is Not Guaranteed Forever (44:17)
• Closing: The Most Predictable Crisis — and Why It’s Still Solvable (47:15)

Gross Domestic Problem is a podcast from Millennial Debt Foundation focusing on America’s biggest financial crisis. Each episode, we break down how we got here, what happens if we don’t act, and the least painful way forward. There’s no do-nothing solution. Subscribe now at grossdomesticproblem.com and join the conversation.

Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

Key topics in today’s conversation include:

• Welcoming Brittany Madni to the Show (0:57)
• Brittany’s Background and EPIC’s Work on Federal Budget Policy (2:12)
• Founders’ Obsession with Public Debt (Jefferson, Washington, Hamilton) (3:23)
• Why Brittany Framed Her Testimony Around the Constitution and the Founders (5:07)
• How the Hearing Went: Partisan Dynamics and Resistance to Spending Talk (7:45)
• Is It Really a Spending Problem? Brittany’s Publix/Credit Card Analogy (13:07)
• Autopilot Spending: 80% of the Budget Not Reviewed Annually by Congress (18:22)
• CBO 10‑Year “Window”: $94.6T in Spending vs. $70T in Revenue (23:20)
• Debt‑to‑GDP Surpassing World War II Levels and What That Means (26:07)
• Exploding Interest Costs and What “Half of Income Taxes to Interest” Means (28:33)
• Losing Fiscal Space to Handle Crises (Wars, Pandemics, Disasters) (31:19)
• Interest Payments Rivaling All Discretionary Spending by Decade’s End (33:01)
• National Debt as National Security and a Threat to Freedom (36:25)
• What a Good Balanced Budget Amendment Must and Must Not Do (43:56)
• Why Brittany Changed Her Mind on a BBA over the Last Decade (47:14)
• Limited Government, Future Generations, and Where to Follow EPIC’s Work (49:52)

Gross Domestic Problem is a podcast from Millennial Debt Foundation focusing on America’s biggest financial crisis. Each episode, we break down how we got here, what happens if we don’t act, and the least painful way forward. There’s no do-nothing solution. Subscribe now at grossdomesticproblem.com and join the conversation.

Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.