When a Gallup Poll showed that 59% of Americans believe a full-fledged economic depression is “somewhat likely” within the next two years, WCCO News in Minneapolis sought out economics professor Raymond Robertson to ask, “Is this the recession that will become a depression?”
“It’s hard to say,” Robertson answered. “Any of the potential shocks that we face could easily slip us into a very, very serious depression.”
Robertson noted that because of safeguards put in place after the Great Depression of the 1930’s, “if you look at recessions over the last 50 to 60 years, they’ve become more mild, they’ve become shorter.”
However, he worries about other problems that could eventually spark a depression, including our “astronomical” trade deficit, the falling dollar, and our out-of-control national debt, much of it owned to other nations.
“If they stop lending us money, we’re going to have to repay that debt ourselves,” Robertson told WCCO. “We would either have to cut spending … or we’d have to raise taxes” — either of which could cause a depression — “or the United States government would have to go into default.”
“We’re going to have to do some very serious sacrifice and work in order to correct these problems,” Robertson concluded.
This video is from WCCO Minneapolis , broadcast April 29, 2008.