Drudge Retort: The Other Side of the News
Thursday, November 15, 2018

Central banks enable debt because they think it will generate economic growth. Sometimes it does. The problem is they create debt with little regard for how it will be used. That's how we get artificial booms and subsequent busts. We are told not to worry about absolute debt levels so long as the economy is growing in line with them. That makes sense. A country with a larger GDP can carry more debt. But that is increasingly not what is happening.

More

Alternate links: Google News | Twitter

This is classic addiction behavior. You have to keep raising the dose to get the same high.

But centuries of history show that every prior debt run-up eventually took its toll on the economy. There is always a Day of Reckoning.

The US economy is so huge and powerful that our current $24.5 trillion government debt (including state and local) could easily grow to $40 trillion before we meet that day. We are one recession away from having a $30 trillion U.S. government debt total.

It will happen seemingly overnight. And deficits will stay well above $1 trillion per year every year after that, not unlike now.

Even though a budget deficit is under $800 billion this year, we added over $1 trillion of actual debt. That is due to "off budget" items that Congress thinks shouldn't be part of the normal budgetary process

Comments

Admin's note: Participants in this discussion must follow the site's moderation policy. Profanity will be filtered. Abusive conduct is not allowed.

you just have to read the economist to find out... cough... PHOENIX... cough...

#1 | Posted by AuntieSocial at 2018-11-16 10:33 PM | Reply

Well thank God Dubya and Cheney reset the fiscal sights of the US from Surplusville to Debtsylvania. Otherwise, we'd've paid off our national debt by now.

I mean, all those tax cuts paid for themselves...right?

#2 | Posted by Danforth at 2018-11-16 10:41 PM | Reply

Comments are closed for this entry.

Home | Breaking News | Comments | User Blogs | Stats | Back Page | RSS Feed | RSS Spec | DMCA Compliance | Privacy | Copyright 2019 World Readable

Drudge Retort