The_GiantNoodle
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- Jul 27, 2011
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Excellent article!
CONTINUED: If you think the debt crisis is bad now ... - Business - Stocks & economy - msnbc.com
There is a comforting story about the debt ceiling that goes like this: Back in the 1990s, the U.S. was shrinking its national debt at a rapid pace. Serious people actually worried about dislocations from having too little government debt. If it hadnt been for two wars, the tax cuts of 2001 and 2003, the housing meltdown, and the subsequent financial crisis and recession, the nations finances would be in fine condition today. And the only obstacle to getting there again, this narrative goes, is political dysfunction in Washington. If the Republicans and Democrats would just split their differences on spending and taxes and raise the debt ceiling, we could all get back to our real lives. Problem solved.
Except its not that way at all. For all our obsessing about it, the national debt is a singularly bad way of measuring the nations financial condition. It includes only a small portion of the nations total liabilities. And its focused on the past. An honest assessment of the countrys projected revenue and expenses over the next generation would show a reality different from the apocalyptic visions conjured by both Democrats and Republicans during the debt-ceiling debate. It would be much worse.
CONTINUED: If you think the debt crisis is bad now ... - Business - Stocks & economy - msnbc.com