Currently our deficit has reached 6% of GDP.
How long is this sustainable, in particulary considering that our
public “living beyond our means” policy is not matched by a huge saving rate in the private sector?
The cynic in me says that eventually all countries will be in such massive debt that we’ll all just say “do over” and wipe all the slates clean.
However I freely admit that the cynical part in that scenario (the massive worldwide debt in amounts far in excess of what we see today) probably has an overly rosy and optimistic ending (the forgiving of the debts of truly impoverished countries who have really no chance of paying them off).
But I’m no economist and I’m sure someone will be along to actually add something of value to this discussion.
By the way Wikstead a more descriptive thread title would get better results. You can use the Report this post to a moderator option at the bottom of your original post to send a message to the mods and ask them to change the title. Descriptive titles are kind of a hot button around here. Also a cite for the 6% figure would lend it some credence.
Just trying to help, please don’t be offended.
Zoid
‘The cynic in me says that eventually all countries will be in such massive debt that we’ll all just say “do over” and wipe all the slates clean.’
That’s the cynic in you?? you must be the most optimistic person in the world.
Be careful. Rummy is quoted in the Los Angeles Times this morning (9 Sept.) as saying that GW’s opponents aid the enemy. And he has Ashcroft to sic on you. Plus the USA Patriot Act.
Welcome to the SDMB Wikstead!
naomi2003, the first part was meant to be cynical, the second part was admittedly rosy. I tried to make that clear in the second part of my post but I guess it wasn’t. Sorry for the confusion.
I doubt it matters, when the US economy is in the tank the world is in the tank…
[url=“http://www.alternet.org/story.html?StoryID=13065”]Here’s an interesting article on the debt, which discusses what I think is the bigger problem, the burgeoning trade deficit. (Note that this article was written in May of last year – the numbers that caused concern then are breathtakingly small compared to what we are faced with today. Oh what a difference a year of . . . interesting policy decisions . . . makes.)
What I think is odd is that the interest rate for savings accounts is ridiculously low these days. Banks aren’t giving much of any reward to people who save their money – inflation operates faster than the interest accumulates, so most people lose money if they put it in the bank.
It’s almost as if we’re being encouraged to drive ourselves into debt… [cue ominious music]
Welcome to the SDMB, Wikstead.
Could I get a cite that the current budget deficit has reached 6% of GDP? I can’t find any figures that put it even as high as 4.7%. Historically, it has been as high as 30% of GDP, and it peaked at 6% in 1983 for the post-war era.
It’s bad, but not disastrous. I would like to see the budget balanced again, but every politician who wants to revoke the tax cuts also has about twenty new ideas on how to spend every dime of the tax cuts and more besides.
Regards,
Shodan
There’s a conspiracy here!