Thursday, June 02, 2016

Alan Greenspan: "We're Running
To A State Of Disaster"
Former Federal Reserve Chair Alan Greenspan is worried about the state of the global economy & in particular about U.S. entitlement programs: "We have a global problem of a shortage in productivity growth and it's not only the United States but it's pretty much around the world, and it's being caused by the fact that populations everywhere in the Western world are aging, and we're not committing enough of our resources to fund that. We should be running federal surpluses right now not deficits. This is something we could have anticipated twenty five years ago and in fact we did, but nobody's done anything about it. This is the crisis which has come upon us .. Entitlements are crowding out savings, and hence capital investment. Capital investment is the critical issue in productivity growth, and productivity growth in turn is the crucial issue in economic growth. We're running to a state of disaster unless we turn this around .. This should be the central issue of the presidential debate. Unless and until we can rein in entitlements, which have been rising at a nine percent annual rate in the United States and comparable levels throughout the world, we are going to find that productivity is going to maintain a very low rate of increase."

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