A cautionary tale of three fiscal crises: The U.S., Britain and Greece
ViewpointsJun 21, 2011
In today’s world, there are three kinds of fiscal crises brought on by too much government spending, and three kinds of responses. We can call them the nightmare scenario, the preemptive experiment and the head-in- the-sand model. In the nightmare scenario, a country runs large deficits for a decade or more ― and the financial markets are happy to buy its debt at low interest rates. But then the m