BREAKING NEWS (?): America is Suffering ‘Debt Fatigue’ –
by Stuart MacPhail – August, 2020
A July 16 article in The Hill by economists Barry Poulson and John Merrifield is headed Debt Fatigue, Not Coronavirus is Destroying America.
They say “Over the past half century … governments at all levels have experienced debt fatigue.” Comparing today to the later part of World War II (the only two times national debt has exceeded national income) they note that “[t]he federal government has again increased debt to levels exceeding our national income.” They also stress that state and local governments have also allowed their debt levels to increase.
They (and many Americans) ask, “If we can’t rely on elected officials to pursue responsible fiscal policies, how can we solve this debt crisis?” The writers point out that “[c]ountries that have been successful in solving their debt debacles, like Switzerland, have done so by imposing ‘debt brake’ rules. When debt levels exceed a debt tolerance level, the debt brake rules mandate a reduction in the rate of growth in government spending until debt is reduced below that debt tolerance level. In the United States, a debt brake would mandate that the federal government reduce the rate of growth in spending until debt is reduced to less than half of national income.”
Poulson and Merrifield submit “The experience in Europe suggests that to be effective in the long run, debt brakes should be incorporated as constitutional rules.” Acknowledging a low probability that Congress will take the lead on such an effort, they say, “If Congress fails to propose such an amendment, citizens could enact the amendment through an Article V Amendment Convention.” Read their op-ed piece HERE.
