Treasury Secretary Scott Bessent stood in front of business students at SMU's Cox School of Business in Dallas on Tuesday and said something refreshingly blunt: “We don't have a revenue problem. We have a spending problem.” His prescription is 3 percent annual economic growth, paired with real spending restraint, so GDP outruns the debt instead of the other way around. I like the diagnosis. I've spent three decades pricing risk for clients that measure mistakes in nine figures, and the math behind Bessent's plan checks out. My concern is Washington's track record of joining the gym in January and disappearing by February.

Bessent calls it the 3-3-3 plan. Three percent real GDP growth, a federal deficit down to 3 percent of GDP, and three million more barrels of domestic oil production a day. Hit all three and the debt-to-GDP ratio stops climbing and starts falling. It isn't a new idea. Growth has bailed this country out of fiscal messes before. But growth has to show up on schedule to do the job Bessent is promising, and right now it's running behind.

The numbers explain the urgency. The national debt cleared $40 trillion last month, and the debt-to-GDP ratio sits around 122 percent, which is the figure economists and bond investors actually watch, not the headline dollar amount. The Congressional Budget Office now projects this year's deficit at $2.1 trillion, roughly double the 3 percent of GDP target Bessent's own framework sets. Getting from here to a 3 percent deficit by 2036 requires something like $10 trillion in deficit reduction over the next decade, with $8.5........

© Townhall