Posted on 12/19/2011 7:45:36 PM PST by neverdem
“If history is any guide, this scenario will develop not gradually but abruptly.”
But we can put some bounds on it. I’m sure, Gingrich, as a historian, knows that governments must default when the debt to GDP ratio gets between 90% and 120%. We are at about 74% now and adding about 10% a year. Growth is stagnant. So the crisis could hit the US in middle to late 2013, just as the fist budget is passed after the election, and definitely by 2016.
Progressives love to spend money and will continue to laud Keynesian economics. (Hopefully, they will not have access to the levers of power, anymore, very soon.)
IMHO
That said, I always thought that Keynes believed in a kind of bottom up econ model, where if people were put to work (even on borrowed money) they would stimulate a demand for goods and services that would put others to work. (Sounds so nice, doesn't it?) The lefties' welfare philosophy follows the same model. I have heard liberals say that each person on welfare creates another job (some even say more).
Corrections invited (or I could even look it up).
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