CBO: ‘Deficits will cause debt to rise to unsupportable levels’
“One impact of rising debt is that increased government borrowing tends to crowd out private investment in productive capital, because the portion of people’s savings used to buy government securities is not available to fund such investment. The result is a smaller capital stock and lower output and incomes in the long run than would otherwise be the case.”… In other words, less savings and investment in capital equipment means overall reduction in growth in the long term…http://www.cbo.gov/ftpdocs/116xx/doc11659/07-27_Debt_FiscalCrisis_Brief.pdf.
