Former Treasury Sec. Lew Says Growth of U.S. Debt Is Troubling

The video discusses the growing concerns over the U.S. debt and deficit, particularly during a period of strong economic growth. It highlights the potential negative impacts on trade balances and interest rates, and the lack of political will to address fiscal responsibility. The discussion also touches on the political challenges in forming a coalition to tackle these issues, given the differing approaches of fiscal conservatives and progressives.

What is unusual about the current growth of the deficit?

• It is increasing during a period of strong economic growth.

• It is decreasing during a recession.

• It is decreasing during a period of high inflation.

• It is stable during a war.

How does a fiscal deficit impact trade balances?

• It reduces the trade deficit.

• It stabilizes the trade deficit.

• It has no effect on trade balances.

• It increases the trade deficit by borrowing from overseas.

What is one effect of a growing fiscal deficit on interest rates?

• It lowers all interest rates.

• It only affects treasury rates.

• It raises all rates in the economy.

• It has no effect on interest rates.

What is a major challenge in promoting fiscal responsibility according to the transcript?

• High levels of public debt.

• Excessive government regulations.

• Lack of understanding among the public.

• Difficulty in forming a coalition for fiscal responsibility.

What historical pattern is noted regarding fiscal policies of different administrations?

• Democratic administrations were fiscally responsible but followed by Republican administrations that increased spending.

• Republican administrations always decrease the deficit.

• Democratic administrations always increase the deficit.

• Both parties have consistently maintained fiscal balance.