Budget forecasts from the Congressional Budget Office (CBO) indicate that by 2021 the U.S. government debt load might rise to Greece’s lofty level, according to a pair of academic economists.
James Harrigan of Utah State University and Antony Davies of Duquesne University write on MarketWatch.com that U.S. debt may climb to almost 150 percent of gross domestic product nine years from now, about the same as Greece’s is today.
So what’s their reasoning?
Editor's Note: Prophetic Economist Warns: “It’s Curtains for America.” See Evidence.
The CBO estimates our debt burden will reach $25 trillion by 2021, up from $16 trillion now. But over the past 15 years, CBO predictions of debt five or more years into the future have undershot by an average of 40 percent, they say.
A 40 percent underestimate would mean an actual debt of $35 trillion in 2021.
Meanwhile, the agency has a solid track record predicting GDP, Harrigan and Davies say. For that statistic the CBO sees a total of $24 trillion for 2021. That leaves a debt-to GDP ratio of 146 percent.
To avoid that mess we need “freer markets, sound money, restricted spending and time,” the economists write.
Republicans are ripping President Barack Obama over the debt explosion.
"Of all the broken promises from President Obama, this is probably the worst one,” GOP vice presidential nominee Paul Ryan said at a campaign rally Tuesday. “This debt is threatening jobs today, it's threatening prosperity today,” in addition to future harm.
Editor's Note: Prophetic Economist Warns: “It’s Curtains for America.” See Evidence.
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