Monday, July 23, 2012

Stockman on Our Looming Debt Disaster

David Stockman provides what rightly has been called scary debt analysis in this interview by Casey Research.

I have become increasingly impressed with Stockman's take on our economic mess since I heard him a year and a half ago deliver the Henry Hazlitt Lecture at the Austrian Scholar's Conference. What makes Stockman's analysis particularly good is that, not only is he sound on how we got here, but he does not sugar coat our situation, nor give us false hope that the piper will not have to be paid.

As Stockman says, "You can't live beyond your means because it's pleasant if it's not sustainable." He understands that the source of real sustainable prosperity is work, savings and sound money, and knows the difference between real wealth and GDP. He also recognizes that fiscal austerity is necessary one way or another. We can either cut spending to get our fiscal house in order voluntarily or have it thrust upon us when the house of debt cards come crashing down.

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