US CBO Chief Questions Bernstein Theory, Says Economic Growth Alone Cannot Solve High Debt

Phillip Swagel, head of the US Congressional Budget Office (CBO), warned that relying on accelerated economic growth to curb federal debt may be ineffective, a conclusion at odds with Treasury Secretary Scott Bessent. Speaking at an event in Minneapolis on Thursday, Swagel stated: 'Economic growth will help, but it is not realistic to expect growth alone to stabilize our fiscal trajectory.' He noted that if interest rates are 4%, the US economy needs to grow by at least 5% annually to stabilize federal debt levels. If rates rise to 5%, real GDP growth would need to reach 6%. (Sina Finance)