Mitchell, Matthew D. “The United States’ Debt Crisis: Far from Solved.” Mercatus Center, Mercatus Center, 21 Aug. 2014, https://www.mercatus.org/research/policy-briefs/united-states-debt-crisis-far-solved.
Direct Quote: There is ample academic evidence that higher debt levels slow economic growth. While there have been challenges to Harvard University economists Carmen Reinhart and Kenneth Rogoff’s landmark 2010 paper18—which demonstrated that countries with debt-to-GDP ratios higher than 90 percent have notably lower economic growth—their essential finding of the adverse impact of high indebtedness on growth has been supported by studies from the European Central Bank,19 the International Monetary Fund,20 and the Bank for International Settlements,21 among others.22 Research has also shown that high levels of debt inhibit economic competitiveness.
Summary/My Interpretation: One of the most harmful impacts of the national debt is its unique ability to impede economic growth. Since the debt not only crowds out the private sector but simultaneously draws funds away from other programs, it creates a world in which nations can’t grow at their full potential. Overall this is bad for the middle class as economic growth has been shown to improve overall quality of life.
How I Will Use This In My Project: As a whole, this article does a good job at explaining how the debt impedes economic growth. I hope to use this source as a way to not only explain this chain of events but I also hope to extrapolate the paper’s findings to how they will affect the middle class.
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