Is Debt Situation Like After WWII?

There is an interesting paper that claims the way debt was brought under control after WWII was "financial repression".   The idea is that government debt levels after WWII were about what they are now and the way they were brought under control was by government controlling private finance and inflation.  The expectation is that austerity and hyperinflation are less acceptable choices,  so we should expect governments to use financial repression to flece their populations.

This basic theory is bogus.  The main reason governments were able to cope with such high debt levels back then is that the high spending levels generating the high debt were due to the war.  Back then more than 3/4ths of the government budget was for the war so it was easy to cut government spending in half once the war was over.  Once the spending problem was solved the debt level was not a killer.

Today there is no equivalent way to cut government spending in half like there was after WWII.   Today most of the budget is mandatory spending.  So even though the US debt level is comparable to after WWII, the US debt level now is a far more difficult and dangerous situation than it was back then.

Investors after WWII understood a history of hundreds of years of gold and silver money.   They did not have much understanding of paper money and inflation.  Back then many could be fooled into owning government debt that paid an interest rate lower than the inflation rate.  After the high inflation of the 1970s investors understand inflation better.  Today, with the Internet, word would get around very fast.  There is just no way that same trick used in "financial repression" could work for 30 years now like it did back then.

FredGraph does not go back before 1947 for government receipts and expenditures.   But here is 1947 to 1950:

The government had expenses of less than $40 billion and income of over that.  If the US government today had budget surplus then the debt situation would be comparable.  However, it has a huge deficit and no credible plan to get it under control, so the situation is very different.