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Politics : Politics for Pros- moderated
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To: Nadine Carroll who wrote (307691)5/30/2009 10:32:11 AM
From: rich evans   of 793928
 
Check out the gdp per capita and the annual growth of gdp for the last 20 years in Denmark vs the US. You pay for the adjustments in lower growth.

Yes that is the key. If the Gov sells its bonds to the public and not the FED then debt is not monetized but money withdrawn from the private sector where it could be invested efficiently causing growth. Instead it goes to the public sector which is much less efficient or a simple transfer payment and you get no growth. We need to grow the pie to pay for future gov spending especially in SS, Medicare and medicaid. To do so the private investment must be greater. We have been lucky to a certain extent so far as foreigners have invested or loaned us money to make up for our poor savings allowing us to grown. These foreign investment/loans will continue but to a much lesser extent(1/3). The gov taking all this money on Lindy's graph means we will stagnate not grow.
Rich
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