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What’s Worse: Sovereign Debt or Climate Change?

In our present money crunch, the nation's debt crisis is often presented as a risk to future generations but economist Dean Baker says the real cross-generational threat is global warming.

What’s the Latest Development?

Amidst the developed world’s debt crisis, funds promised to help mitigate climate change are coming up short. But given the scale of global warming, concern for our own future generations now coincides with those of other nations. Economist Dean Baker dismisses the notion that solving our budget crisis (through austerity measures) should take priority over solving climate change problems: “If the deficit has little to with the well being of our children and grandchildren, global warming has everything to do with it.”

What’s the Big Idea?

Baker argues that the budget deficit is not a cross-generational problem because future generations, when they pay back the debt, will essentially be paying themselves. And the large portion of our debt is that owned by other countries? Baker says those concerned about trade deficits should be focusing on making the dollar more competitive, i.e. weakening it. The main factor that will contribute to our children’s well being is the economy. And that depends, says Dean, on good education, good infrastructure and the natural environment.

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