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Politics : PRESIDENT GEORGE W. BUSH
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To: TimbaBear who wrote (118482)12/21/2000 2:30:10 AM
From: Bernard Levy  Read Replies (1) of 769670
 
The current federal debt as a portion of GDP
is actually rather low (about 50% of GDP). As a
benchmark the federal debt was about 110% of GDP
at the end of WW2 and decreased to about 30% in
the early 60s, even though the Fed govt run
a small yearly deficit most of the time. The secret:
economic growth.

As a comparison, Japan's debt is 130% of GDP and growing.
About 10 years ago, Canada's debt was also above 100%
of GDP. So, in fact the US debt is reasonable, and
does not require surpluses as long as the economy is
growing within a 2 to 4% range and as long as the
budget remains roughly in balance.

Also, asset allocation by govt tends to be way
less efficient than allocations by companies or
households (need I mention $200 hammers). So minimizing
the amount of money in the hands of politicians
is always desirable.
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