In the context of the increasing budget deficit and public debt, on one hand, and the need to restore economic growth without compromising financial stability and fiscal sustainability on long term, on the other hand, governments must undertake severe measures concentrated especially on...

The United States has a huge long-term fiscal gap, perhaps with a present value of around $74 trillion. By contrast, the explicit national debt of the U.S. is only around $6 trillion. The U.S. may thus be unable to continue meeting its current spending commitments without eventually enacting...

This paper provides a numerical analysis of the likely benefits from adopting alternative ways of reducing the projected fiscal surplus (as of the summer 2001) in the United States economy. Calibrating a small growth model, our results suggest that investing the surplus in public capital is...

The fall in the U.S. public debt/GDP ratio from 106% in 1946 to 23% in 1974 is often attributed to high rates of economic growth. This paper examines the roles of three other factors: primary budget surpluses, surprise inflation, and pegged interest rates before the Fed-Treasury Accord of 1951....

The rapidly growing federal government debt has become a concern for policy makers and the public. Yet the U.S. government has seemingly unbounded access to credit at low interest rates. Historically, Treasury yields have been below the growth rate of the economy. The paper examines the...

Recent research and events have brought fiscal policy back into the spotlight. Fiscal Taylor rules and error correction models have represented two different ways of quantifying the feedbacks from fiscal and economic conditions to fiscal policy decisions. This paper synthesizes these two ideas,...

Public sector unions around the world are under threat from political forces. Combined, the financial crisis and austerity measures have challenged public sector unions’ legitimacy. In the U.S., the postrecession assault on public sector unions is rooted in political ideology, with not only a...

The business model used by Congress to pay for Social Security, Medicare and national debt is our costliest federal mandate. Because they run a national retirement plan without using compound interest, Congress makes us pay TWELVE dollars to do a ONE-dollar job. This business model is the root...

Using U.S. data for 1976-2013, this paper studies the effects of various macroeconomic variables, particularly the national debt, government budget deficits and taxes, on fertility decisions over the business cycle. A rise in the debt-GDP ratio, government spending-GDP ratio and the deficit-GDP...

The financial crisis and the ensuing Great Recession created unprecedented federal budget deficits in recent years. In fact, these events, combined with subsequent slow growth and two continuing unfunded wars, have resulted in a national debt that is out of control by all meaningful measures....