Iconoclastic economist and Boston University professor Larry Kotlikoff, describes the US as arguably in worst fiscal shape than any other developed country. He estimates the fiscal gap at US$200 trillion, 17 times the reported US$12 trillion in official debt. What would it take to come up with US$200 trillion in present value? The answer is tax hikes/spending cuts amounting to 10% of GDP, starting immediately and continuing indefinitely. In terms of generational accounting, were we to leave our kids and future descendants to cover the entire fiscal gap, they'd face tax rates over their lifetimes around twice as high as those we face, says Kotlikoff. Our country is broke. It's not broke in 50 years or 30 years or 10 years. It's broke today. Economists from all political persuasions are collectively sending our government a warning about what is, effectively, a nuclear economic bomb, says Kotlikoff. (VIEW LINK)
Please sign in to comment on this wire.