How big a problem is public debt?
Lots of people these days are concerned about mounting public debt, particularly in light of the TARP and stimulus programs. On one hand I see some cause for concern. Our public debt to GDP ratio isn't as high as it was during World War 2, so maybe we've got some breathing room. On the other hand at the end of World War 2 we had a ton of manufacturing capacity and we had a devastated world to rebuild which put us in a very good position during the 50s and 60s. That's *not* true these days, with a terrible trade deficit and deficits going toward wars of choice and tax cuts.
This seems like a good time to consider marginal benefit. How fucked is our country, compared to other countries? This table of public debt to GDP ratios ranks us 47th out of 129, with a 53% debt-to-GDP ratio, and includes a number of other surprises. We carry a much higher debt than the Socialist spendthrift paradises of Denmark (42%) and Cuba (35%). The Russian economy is supposed to be in tatters but they owe just 6.3% of their GDP. On the other hand Canada always seems to have its shit together and it owes 75%. Germany (72%) is supposedly a model of austerity but they owe more than the crisis-stricken UK (68%). And Japan, which I remember as an industrial juggernaut in the 80s, owes 189% second only to Zimbabwe and yet their currency has been doing great for years.
So is it "hysteria" or a serious problem? I honestly don't know. What I *do* note with some irony is that the people making the biggest deal about this don't have a very good record themselves, consider defense spending a taboo, like to remind us how Reagan proved deficits don't matter, often have serious conflicts of interest. I can see pretty clearly how this is a good trope to bring out during an election year against someone who got stuck with the consequences of the last guy's problems, but I have a much harder time seeing whether this is (or isn't) actually a serious problem in itself.
This seems like a good time to consider marginal benefit. How fucked is our country, compared to other countries? This table of public debt to GDP ratios ranks us 47th out of 129, with a 53% debt-to-GDP ratio, and includes a number of other surprises. We carry a much higher debt than the Socialist spendthrift paradises of Denmark (42%) and Cuba (35%). The Russian economy is supposed to be in tatters but they owe just 6.3% of their GDP. On the other hand Canada always seems to have its shit together and it owes 75%. Germany (72%) is supposedly a model of austerity but they owe more than the crisis-stricken UK (68%). And Japan, which I remember as an industrial juggernaut in the 80s, owes 189% second only to Zimbabwe and yet their currency has been doing great for years.
So is it "hysteria" or a serious problem? I honestly don't know. What I *do* note with some irony is that the people making the biggest deal about this don't have a very good record themselves, consider defense spending a taboo, like to remind us how Reagan proved deficits don't matter, often have serious conflicts of interest. I can see pretty clearly how this is a good trope to bring out during an election year against someone who got stuck with the consequences of the last guy's problems, but I have a much harder time seeing whether this is (or isn't) actually a serious problem in itself.