PHIL GRAMM: The Subprime Superhighway

highway

Wall Street Journal – The U.S. and Europe are lowering capital standards for ‘investments’ in public infrastructure—ignoring the lessons from 2007-08.

More government spending, particularly for infrastructure projects, is the mantra in Washington and other capitals. But two factors stand in the way. First, the governments of most developed economies are broke. According to their own government figures for 2015, the total public debt of European Union members as a share of GDP is 85%, U.S. debt is 101% and Japanese debt is 229%. Second, the rates of return on infrastructure investments are generally low. As European Central Bank President Mario Draghi said in an interview last…

FULL ARTICLE