Thanks Larry. Given that governments can generate tax receipts indefinitely, it is my understanding that some amount of government debt is fine, even preferred perhaps. If so, is there a "reasonable" target for the government's long-term debt-to-GDP ratio or fiscal gap? And, lastly, what would it take in terms of tax increases and/or spending cuts to get there?
Consistent economic growth solves everything. To achieve that requires a growing population. Immigration helps but many new arrivals lack the skills needed to foster growth. US moms need to have more children but they are a 20 year societal investment before they contribute to growth and are consumptive up until then. So supply side choices are limited.
I expect the solution will be means testing of Social Security and Medicare but that'll have to wait until Boomers exit the stage because they represent too many votes.
Thanks Larry. Given that governments can generate tax receipts indefinitely, it is my understanding that some amount of government debt is fine, even preferred perhaps. If so, is there a "reasonable" target for the government's long-term debt-to-GDP ratio or fiscal gap? And, lastly, what would it take in terms of tax increases and/or spending cuts to get there?
Consistent economic growth solves everything. To achieve that requires a growing population. Immigration helps but many new arrivals lack the skills needed to foster growth. US moms need to have more children but they are a 20 year societal investment before they contribute to growth and are consumptive up until then. So supply side choices are limited.
I expect the solution will be means testing of Social Security and Medicare but that'll have to wait until Boomers exit the stage because they represent too many votes.