No doubt there will be those who find such fear-mongering persuasive. But for the rest of us, it suggests a rather pressing and relevant question: Just what, precisely, did we get from doubling the cost of the federal government between 2000 and 2010?
If the bureaucrats can’t produce an explanation for the price increase of government, then they should not expect their budgets to be rubber-stamped by an already suffering public. …
We are living with the results: National debt greater than 100% of annual gross domestic product and no end in sight, just as the baby boomers stop working and start sucking down expensive federal entitlements.
Even if borrowing costs remain at their historic lows in perpetuity, this kind of debt overhang is more dangerous than any mild bureaucratic shuffle necessitated by the 1% trim. Why? In their controversial April 2012 National Bureau for Economic Research working paper, economists Carmen M. Reinhart, Vincent R. Reinhart and Kenneth S. Rogoff concluded that when countries carry debt of more than 90% of GDP for five or more consecutive years, economic growth gets chopped down by more than a whole percentage point each year for decades.