LogFAQs > #921826586

Forceful_Dragon posted...

If the economy is good, then that's good.

I have to wonder if cutting taxes in the way that it occurred was a viable long term strategy to achieve their current state of the economy. It seems to me that we're going to be paying for our "4%" growth eventually via the national debt, but we've essentially passed to buck down the road. This is not unique to Trump. Numerous administration's have opted to make things better in the short term by worsening our long term debt. It abstracts the cost so it isn't feeling as keenly.

But hey, I'm no economist so if legitimate economists are of the opinion that things are good, then sure, they are good.

It's not unique to Trump but given the way he ran his businesses, it'd be very surprising if he didn't massively increase the national debt. A national debt of only 100% of GDP must look like a massively underleveraged opportunity to Trump. Trump likes his businesses saddled with so much debt that the interest payments alone amount to 100% or so of the income. Then if growing your way out of the debt and selling the business to a greater fool both don't work, it's time to declare bankruptcy and force your creditors to eat the loss.

For an entity like the US government with a perfect 240+ year credit history, a low interest rate, and control of the currency in which the debt is issued (which is also the world's reserve currency), a national debt at 200% of GDP should be no problem. Japan manages that without the advantage of issuing the world's reserve currency. Now 200% of GDP is probably still way underleveraged in Trump's eyes, but our exit plan presumably isn't bankruptcy, so that's alright.
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September 1, 2003; November 4, 2007; September 2, 2013
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