Veronique de Rugy worries:
There is no firm rule on when deficits or public debts are too high relative to an economy’s size. Prior to the crisis, the general consensus was that rich countries could safely have public debts worth 60 percent of GDP. And although Japan’s debt has exceeded 100 percent of GDP for many years, the government has yet to suffer a financing crisis.
However, it doesn’t mean that things won’t change. Investors judge default risks on a curve. They will assess one government against others (for instance, the United States vs. France, Germany, China, and Norway). When the markets do lose confidence in a government’s fiscal rectitude relative to others, a crisis can arise quite quickly, forcing countries into painful political decisions. And this could very well happen to the United States.
And look at the Blair-Brown legacy in Britain!