Zuckerman: Debt Will Cause ‘Real Crisis’

Mort Zuckerman, Editor-in-Chief and publisher of the New York Daily News and US News and World Report Chairman, declared that the US national debt would create “a real crisis” on Friday’s “McLaughlin Group.”

Zuckerman started by saying there was “some truth” to House Speaker John Boehner’s (R-OH) statement that the president’s budget was “more taxes, more spending, bigger government here in Washington, the same old policies that have failed for the last six years.” He continued, “on the other hand, the President has to deal with a very weak economy, relatively, and we’re going to have these kinds of deficits. The real question is: now, how are we going to be able to get some of these deficits under control? Because at some point, there’s going to be a real crisis, a financial crisis, as our debts just accumulate. If you — if you look at it now, for example, you will see that the deficits are going to continue to go through the next half dozen years and we’re going to be in the situation where the debt’s going to — the debt service is going to use up a lot of our funds, and if we get any kind of inflation, okay? You’ll get a much higher interest rate and you’ll get a much higher debt service obligation, leaving much less for whatever we need in the country to service the country’s economy.”

Zuckerman concluded, “Obama puts forth a whole series of programs that are going to cost billions and billions of dollars at this stage of the game. This is not the time, in my judgment, to do that.”

Later in the show, he added “we have a terrifically difficult issue here to face, okay? We simply cannot run-up all these deficits forever. One other thing that it is going to happen at some point is inflation, okay? And if that inflation hits, then we’re really going to be in trouble. So, we’ve got to be very careful about how we handle this.”

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