“Good Debt” and “Bad Debt?”

AUTHOR: Joseph Minarik, Senior Vice President and Director of Research, Committee for Economic Development
Aug 03, 2010

You’ve heard the story: A private business borrows money foolishly — say, to finance a corporate jet used mainly to fly the CEO off to ski. That borrowing surely results in “bad debt” — not necessarily debt that will not be repaid, but rather debt unwisely incurred, with little offsetting long-run benefit. On the other hand, the same firm might borrow to update its production equipment. That borrowing would increase debt, but it would be “good debt.

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The “Lost Decade” (Plus Two) for the Budget

AUTHOR: Joseph Minarik, Senior Vice President and Director of Research, Committee for Economic Development
Mar 11, 2010

Followers of the issue of the federal budget deficit and the public debt have been worried for years. In fact, typical citizens probably have come to hear experts’ warnings as a cross between “The sky is falling!” and “Wolf!”

Now, those cries are beginning to ring true. But many people probably still hesitate to accept the message. Perhaps a picture can begin to make that message clear.

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