Also in this playlist...
This transcript is automatically generated
While the government cannot borrow quote indefinitely.
Those the words of warning from Fed chair Ben Bernanke at a congressional hearing Bernanke.
Urging lawmakers to make the commitment and reduce.
The nearly two trillion dollar budget deficit listen.
Addressing the country's fiscal problems will require a willingness to make difficult choices.
In the end the fundamental decision that the congress the administration and the American people must confront.
-- how larger share of the nation's economic resources to devote to federal government programs including entitlement programs.
Crucially whatever size of government is chosen tax rates must ultimately be set at a level sufficient to achieve an appropriate balance of spending and revenues.
In the long run New Hampshire senator Judd Gregg is -- ranking member on the Senate Budget Committee he joins us now and senator welcome to you first of all you know that the Fed chief is now.
Sounding the alarm on budget deficit you've been sounding this alarm now for several months is anybody the White House listening.
Well I wish they were and certainly some of their languages correct we've heard a number of members of the White House team stated that that is unsustainable but unfortunately the actions are just the opposite is that.
-- we're seeing proposal after proposal to add significantly more.
Spending entitlement programs which are aggravated that situation we can take -- GM situation on the proposals on health -- examples of that.
The simple fact is that this administration has proposed a budget which doubles the dead and five years triples -- in ten years puts in a position where the national debt.
Public debt is 80% of GDP.
I -- the deficits are averaging a trillion dollars a year for the next ten years that's.
Not always not sustainable at least basically an economic meltdown for our country against inflation massive tax increases things which we cannot tell you mentioned the car companies in the healthcare when there's TARP and tell content and all these these acronyms -- the bottom line is the president has admitted that were broke.
And yet we continue these programs and there's only a couple of solutions and one of them is for us to keen to keep borrowing more money.
But borrowing more money senator means that interest rates are gonna go what may be dramatically up.
And that will stop this recovery true.
-- do much more.
More negative things than that you get -- -- -- warning signs around the world that are fairly significant for example -- and poor's warned about the UK debt situation UK is about 50% of GDP -- 57% of GDP.
You've got the Chinese three -- four major Chinese leaders in there on their financial side saying that they don't have to buy American Dad!.
And that's very serious.
And then you've got our own debt sales were you know we've got a four year roll over now on average of our data and that's the shortest.
Post World War II period.
Which means that people are very worried about going along on American -- So -- -- -- people are sits under this the warning signs -- -- listen get your fiscal house in order against.
And if something in place -- -- your -- issue and I got very little time left senator but people are also saying we really don't want these new taxes and other talking about his value added tax wouldn't gives value to I don't know how they named it that the value added tax -- What which would increase the price is -- pretty much everything from Orange juice to -- to gas to a visit would your attorney and the only other way to pay for all of these.
Ambitious agenda items is to raise taxes dramatically right.
Or inflate the economy note that the problem is spending it's not taxes the fact is this administration is proposing to take the federal -- the federal government.
And 40% GDP.
Which has been is that it's historic size since World War II but they're going to -- -- assistance -- -- 7% of GDP.
And if they cover that cost of taxes.
Then they're basically going to create a situation where were much that's productive country and we reduce the standard of living.
Or they play our economy to try to pay -- debt that you have the same effect.
Senator way to address this is the control spending controlling spending that we could look at it look -- the Westwood California the disaster of taxing and spending out there who has led us here senator Judd Gregg thank you sir.
Thank you Michael spending and that government and also at -- right.
Filter by section