“Ken Rogoff of Harvard and Carmen Reinhart of Maryland have studied the impact of high levels of national debt on economic growth in the U.S. and around the world in the last two centuries…they conclude that, so long as the gross debt-GDP ratio is relatively modest, 30%-90% of GDP, the negative growth impact of higher debt is likely to be modest as well. But as it gets to 90% of GDP, there is a dramatic slowing of economic growth by at least one percentage point a year…The Obama budget takes the publicly held debt to 73% and the gross debt to 103% of GDP by 2015, over this precipice.
Mr. Obama’s fiscal strategy is more akin to the voyage of the Titanic. Let’s hope he changes course soon enough to prevent disaster.”
- MICHAEL J. BOSKIN, professor of economics at Stanford University
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