# How important is the debt? **URL:** \ **Category:** Great Debates\ **Created:** [January 26, 2020, 3:08pm UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992 "2020-01-26T15:08:53Z")\ **Posts on this page:** 5\ **Page:** 5
**Author:** ![asahi](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/asahi/32/8693_2.png) [@asahi](https://boards.straightdope.com/u/asahi)\ **Post date:** [February 10, 2020, 3:20am UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992/82 "2020-02-10T03:20:45Z")
LOL, right on cue: What’s the president’s solution to the debt? Make the poorest, neediest people pay it off while the rich get a break. [https://www.politico.com/news/2020/02/09/trump-border-wall-cash-billions-112860](https://www.politico.com/news/2020/02/09/trump-border-wall-cash-billions-112860) > [@](#): > > For example, the administration is seeking an 8 percent cut to USDA’s budget over current funding levels. Trump’s plan would cut the Commerce Department by 37 percent, the Education Department by 8 percent, the Energy Department by 8 percent, the Department of Housing and Urban Development by 15 percent, and the Department of Health and Human Services by 9 percent. ---
**Author:** ![survinga](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@survinga](https://boards.straightdope.com/u/survinga)\ **Post date:** [February 11, 2020, 11:58am UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992/83 "2020-02-11T11:58:11Z")
> [@asahi](#): > > LOL, right on cue: What’s the president’s solution to the debt? Make the poorest, neediest people pay it off while the rich get a break. > > [https://www.politico.com/news/2020/02/09/trump-border-wall-cash-billions-112860](https://www.politico.com/news/2020/02/09/trump-border-wall-cash-billions-112860) That “budget” isn’t worth the paper it’s written on. It will be DOA, and Trump knows it. It reminds me of all the “repeal ACA” votes the Republican house used to do. It was a statement, not actually governing. ---
**Author:** ![survinga](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@survinga](https://boards.straightdope.com/u/survinga)\ **Post date:** [February 11, 2020, 12:02pm UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992/84 "2020-02-11T12:02:57Z")
> [@asahi](#): > > There’s no way to say they wouldn’t have. There’s no evidence that they would have supported stimulus through generous spending programs. They weren’t acting out of character when they threatened to default on fighting a debt ceiling increase - they were very much in character. Had they been in power they would have probably passed tax cuts, which would have justified slight debt ceiling increases along the way. Debt ceiling increases don’t materially result in stimulus. We’re having to make minimum payments on the interest itself. I know they weren’t acting out of character, because Obama is a Dem, and they reserve their austerity games for Democrat white houses only. That was the point of my post, and I backed it up with examples, and Krugman’s column said basically the same thing. Dem in white house = time for false debt/deficit concern Pub in white house = time to ramp up debt/deficits That’s their formula. You made the statement that they always resort to austerity in recessions. That’s not true. If there’s a recession while Trump is in office, we’ll see another example of what I’m saying. They use fiscal policy as a political weapon. ---
**Author:** ![Max\_S](https://avatars.discourse-cdn.com/v4/letter/m/46a35a/32.png) [@Max\_S](https://boards.straightdope.com/u/Max_S)\ **Post date:** [February 20, 2020, 12:31am UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992/85 "2020-02-20T00:31:13Z")
> [@survinga](#): > > I know they weren’t acting out of character, because Obama is a Dem, and they reserve their austerity games for Democrat white houses only. That was the point of my post, and I backed it up with examples, and Krugman’s column said basically the same thing. > > Dem in white house = time for false debt/deficit concern > Pub in white house = time to ramp up debt/deficits > > That’s their formula. You made the statement that they always resort to austerity in recessions. That’s not true. If there’s a recession while Trump is in office, we’ll see another example of what I’m saying. They use fiscal policy as a political weapon. Is this the debate you want to have? Whether the GOP really cares about debt? I’m not going to try and defend them, but… well, I thought you were going more towards “should the debt be important?” I found _that_ debate to be quite interesting. ~Max ---
**Author:** ![survinga](https://avatars.discourse-cdn.com/v4/letter/s/cab0a1/32.png) [@survinga](https://boards.straightdope.com/u/survinga)\ **Post date:** [February 22, 2020, 2:30pm UTC](https://boards.straightdope.com/t/how-important-is-the-debt/846992/86 "2020-02-22T14:30:36Z")
> [@Max\_S](#): > > Is this the debate you want to have? Whether the GOP really cares about debt? > > I’m not going to try and defend them, but… well, I thought you were going more towards “should the debt be important?” I found _that_ debate to be quite interesting. > > ~Max OK, so here’s something from Olivier Blanchard, world-renowned economist, who says that the debt isn’t that important. I don’t think he says it’s of no concern at all. But it’s much less important than many folks think, in his view. He does say that spending must be well thought out. [https://www.marketwatch.com/story/leading-economist-says-high-public-debt-might-not-be-so-bad-2019-01-07](https://www.marketwatch.com/story/leading-economist-says-high-public-debt-might-not-be-so-bad-2019-01-07) Then, here’s Greg Mankiw, Harvard Economist and former advisor to George W Bush and Mitt Romney. I would note that he broke with the Republicans after Trump came to power. Anyway, Mankiw says the debt is still a concern, still a problem. > **[The National Debt Is Still a Problem (Published 2019)](https://www.nytimes.com/2019/06/20/business/national-debt-trump.html)** > > A rising budget deficit may make sense in a major war or recession but not now, when the economy is strong, the economist N. Gregory Mankiw says. Here’s Paul Krugman, Nobel Economist and NY Times columnist, on debt. He says it’s basically not a problem as long as interest rates aren’t as high as the rate of growth. He says it could become a problem, but not in the current environment, and way down on the list of problems. > **[Opinion | On the Debt Non-Spiral (Published 2018)](https://www.nytimes.com/2018/09/11/opinion/on-the-debt-non-spiral.html)** > > Secular stagnation means even less reason to worry Here’s Ken Rogoff, Economist from Harvard, on debt. He argues that it’s not a free lunch, that we should be more concerned about it than we are. > **[Government Debt Is Not a Free Lunch | by Kenneth Rogoff - Project Syndicate](https://www.project-syndicate.org/commentary/government-debt-low-interest-rates-no-free-lunch-by-kenneth-rogoff-2019-11?barrier=accesspaylog)** > > Kenneth Rogoff argues that today’s ultra-low interest rates should not obscure the risks of sharply higher public borrowing. I used to think Debt/Deficits were big problems. Now, I’m not so sure. I would think there has to be a blurry line that when crossed can make debt a huge problem. But for the US, I think that would require a loss in confidence in the US economy’s ability to service our debt. On the other hand, having such a high debt level (debt/gdp now around 79% and climbing) might eventually make interest on the debt a drag on our economy. So, there has to be some costs there. Maybe a huge debt is not a cause of a problem, so much as a symptom from another problem. Take Japan for instance. They have debt/gdp over 200%. I think that’s a result of very low growth, demographic stagnation, and so forth. But the Japan debt itself isn’t likely to lead to a run on the bank. They can still borrow at very low, and even negative interest rates. [Previous page](https://boards.straightdope.com/t/how-important-is-the-debt/846992.md?page=4)