Think tanks of different persuasions agree that this growth in debt is not sustainable, but there is little consensus on how to "Fix the debt"; most proposals are unrealistic and misleading.
Experience with debt in other highly indebted countries suggests that simply closing the fiscal gap is not a sufficient condition for fixing the debt.
The countries that have been successful in fixing their debt have done so by significantly reducing debt as a share of national income below the consensus target of 60 percent.
Countries such as Sweden and Switzerland, for example, have reduced debt to sustainable levels by imposing a so-called "Debt brake," limiting the growth of spending and using surplus revenue to reduce their debt.
With overwhelming support from their citizens in referendums, the Swiss enacted debt brakes to reduce debt significantly to sustainable levels; and during the recent financial crisis, they achieved economic stability without incurring more debt.
Over the past half-century, fiscal rules in the United States have failed to constrain debt, allowing debt to grow at an unsustainable rate.
Perhaps a reality check will help wake up citizens the risk that high levels of debt pose for our future.
https://www.americanthinker.com/articles/2019/11/fixing_the_debt_a_reality_check.html
Experience with debt in other highly indebted countries suggests that simply closing the fiscal gap is not a sufficient condition for fixing the debt.
The countries that have been successful in fixing their debt have done so by significantly reducing debt as a share of national income below the consensus target of 60 percent.
Countries such as Sweden and Switzerland, for example, have reduced debt to sustainable levels by imposing a so-called "Debt brake," limiting the growth of spending and using surplus revenue to reduce their debt.
With overwhelming support from their citizens in referendums, the Swiss enacted debt brakes to reduce debt significantly to sustainable levels; and during the recent financial crisis, they achieved economic stability without incurring more debt.
Over the past half-century, fiscal rules in the United States have failed to constrain debt, allowing debt to grow at an unsustainable rate.
Perhaps a reality check will help wake up citizens the risk that high levels of debt pose for our future.
https://www.americanthinker.com/articles/2019/11/fixing_the_debt_a_reality_check.html
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