A US legislator has predicted that unless Washington finds a way to tackle the problem of the country’s national debt, the US financial system may be in peril.
During an interview on Fox News, US Congressmen Andy Biggs agreed with the assessment made by several of the program’s guests about the US national debt creating a “debt bomb explosion” that may wreck the country’s financial system.
“I think we’re headed over the edge. Think of it as a waterfall, we’re in the boat, and now we’re almost at the point where we can’t get out of the flow. We’re heading over unless we do something immediately,” the congressman warned.
Biggs also criticized politicians who appear unwilling to deal with the “debt bomb” issue as they apparently lack the “political will” to inflict “short-term pain” in order to fix the problem.
“It’s a path-dependent approach. We’re on a sub-optimum path, but to exit this path, to get on an optimum path is short-term pain, just as you say. They view it as too high of a political cost. But every day that we delay, we drop off some options we might have to fix this problem,” the congressman told the show’s host.
According to Biggs, the real issue the US is currently facing is a “structural deficit,” as the country spends more than it “brings in.”
“If you don’t start doing it now, then in ten years you’ll have no choice. You can inflate your currency, you can default on your debt, you can try to raise your taxes and kill your economy – these are the choices that we’ll be looking at in about eight to ten years,” Biggs warned, adding that he thinks it would be unfair to impose such a dilemma on future generations.
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Earlier in March, the US national debt topped the $21 trillion mark for the first time in history.
Commenting on this development, former US Secretary of Commerce Peter Peterson warned that “this unfortunate milestone has only just begun to include the effects of the recent fiscally irresponsible tax and spending legislation,” which he claimed “added more debt on top of an already unsustainable trajectory.”