What is the Obama/Krugman Economic Endgame?

It’s the question I frequently ask of even-keeled Democrats —  what is the endgame envisioned by Obama and his shadow economic adviser, Paul Krugman?   That is, the country has taken on a tremendous debt load — and continues to take on debt — as a percent of overall economic activity.  Where do they foresee this taking the country?

Debt, in and of itself, is not necessarily a bad thing, especially when it is being used to invest in the creation of future wealth. However, any dime store investor knows that debt must be managed.  Thus, the options for country are:

1) plan to pay down the debt in a normal fashion using the benefits of future economic activity;

2) plan to pay down less debt at some fraction of the original amount by renegotiating the terms;

3) plan to pay down less debt as a portion of the overall economy by inflating the currency;

Option 1 is highly unlikely given the current circumstances (interest rates, debt to GDP ratios, etc.).  Thus, is could be Option 2 or 3.  Is there an Option 4?

You don’t see the mainstream journalists asking these simple questions:  “Krugman – you’ve said that the stimulus should have been closer to $2 trillion…  what would be the result of taking on that debt?  Obama – you’re continuing to operate the country at a huge deficit.  How do you envision the country repaying that debt?”

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