Economist Warns: Coming U.S. Bond Default

Friday, November 6, 2009 8:59 AM

By: Gene J. Koprowski

The U.S. may have to default on its debt payments after 2019, writes economist Robert Samuelson.

If the deficit spending continues on the current path it will consume 82 percent of gross domestic product within a decade. There will be no wiggle room for tax cuts, and spending cuts may be politically unpalatable, he surmises.

“The Congressional Budget Office reckons the Obama administration's planned budgets would increase the debt-to-GDP ratio from 41 percent in 2008 to 82 percent in 2019. Higher interest rates would aggravate the debt burden,â€