Blogs > Cliopatria > The Wisdom of Intellectuals

Nov 29, 2011

The Wisdom of Intellectuals

"So my comparison country, I look believe it or not at Belgium, which has got debt which is I think 87% of GDP. And Belgium is, you know, is nothing particularly special. It's actually a little bit less stable than most Western advanced countries because of the ethnic and linguistic divide. But there's no run on Belgian debt. They're able to do that. So that suggests that we could probably, in the United States, add debt that was like forty percent of GDP, if it became necessary, which actually does turn out to be $5.6, $6 trillion."

-- Paul Krugman, July 7, 2009

"Juan Linz, professor of social science at Yale, argued that parliamentary systems are superior to presidential systems for reasons of stability. In a parliamentary system, he contended, the legislature and the executive are fused so there is no contest for national legitimacy... Remember, the political battle surrounding the debt ceiling is actually impossible in a parliamentary system because the executive controls the legislature. There could not be a public spectacle of the two branches of government squabbling and holding the country hostage."

-- Fareed Zakaria, "Does America Need a Prime Minister?" August 17, 2011

Europe is a model of financial and economic stability, and one that the United States should emulate. Belgian debt is sustainable and wholly unproblematic, and financial markets have confidence in Belgium, so the United States can easily take on a few trillion dollars in additional debt. Europeans have parliamentary government, and so could have no "public spectacle" of squabbling over debt.

See, it's impossible to have this kind of insight without a lot of very expensive and sophisticated education. We have nothing to rethink, except to demand more funding. Stay the course!

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