According to the Washington Post President Obama reportedly responded to a question about his budget by saying that "'But there is a chance that if we leave such a mountain of debt to the next generation,' living standards will fall." Actually, there is no plausible scenario under which government debt will lead to worse living standards on average for future generations. Projections from the Congressional Budget Office and elsewhere show even large accumulations of debt having only modest impact on slowing economic growth and the rate of improvement in living standards. It is surprising that the Post did not point out this extraordinary presidential gaffe.
--Dean Baker
