From his testimony this morning on Capital Hill:
"There are limits to how big the deficit and the debt can be. Soon it will begin to have effects on interest rates, it will have effects on economic growth, and on stability, so ... it's not just balancing the federal budget, it's really a much broader question of the stability and strength of our economy over a longer period of time,"
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Soon...?
"There are limits to how big the deficit and the debt can be. Soon it will begin to have effects on interest rates"
You mean our current debt has no effect on interest rates? Is there any justification for these fear tactics that there is some debt cliff that we are about to fall off of? The effect of debt on interest rates should be linear. There have been much higher debt and deficit levels around the world without catastrophes.
Now there is an absolute upper limit on how high taxes can go. I don't think anything has a bigger effect on interest rates and growth than Capital gains taxes.
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