National Debts Can Threaten Economic Growth

 　　Efforts to slash¹ national debts are at the heart of fierce debates in United States and protests in other nations.  In some cases, these government debts are bigger than the entire economic output of the nation for a year. Debt problems can slow economic growth, raise interest rates and make financial problems worse.

　　To get an idea just how large a nation's debts are, economists³ compare the size of the debt with the size of the nation's economic output.

　　Economist² Till Schreiber says too big a debt burden can hurt the economy.

　　"There is some research by economists that on average across all different countries - rich and poor and medium income countries - 90 percent debt-to-GDP ratios suggest a slowdown in growth," said Schreiber.

　　Schreiber teaches at the College of William and Mary in Virginia.  He says nations with strong industries and domestic savings⁴, like Japan, can bear far larger debt burdens than other countries, like Portugal, which has lost many of its industries and jobs to foreign competition.

　　Lenders express their confidence in Japan's economy by offering loans to Tokyo at relatively⁵ low interest rates, while Portugal has to pay a high rate, called a "risk premium⁶."

　　La Salle University Finance Professor Walt Schubert says investors⁷ and lenders set interest rates by looking closely at a nation's economy.

　　"The ability to pay [repay loans] is the ultimate issue," said Schubert. "What investors are worried about is what is going to happen to your debt and what is going to happen to your GDP."

　　Although experts have no doubt about the ability of the United States to repay its loans, major credit rating agencies warn that they might downgrade America's credit rating unless Washington resolves the political impasse⁸ between President Barack Obama and Republicans in Congress.

　　Some experts say a downgrade of America's AAA credit rating is a strong possibility, even if Congress and the President manage to work out a deal before August 2 - the date the United States is expected to reach its debt ceiling and default on its financial obligations.

　　A lower credit rating would bring higher interest rates on the $14.3 trillion U.S. debt, which is nearly as much as the value of all of the goods and services produced in the United States in a year.  The U.S. debt is so large that even a small interest rate increase would cost billions of dollars.

　　American Enterprise Institute scholar Kevin Hassett says a debt rating change could set off a downward economic spiral for the United States.

　　"As your rating goes down a little, the interest rate goes up a little, and then you have got to make more interest payments and so your deficit⁹ gets larger," said Hassett. "And the larger deficit makes the rating agency a little more nervous and so they lower your rating again.  And then you end up in kind of a death spiral."

　　Hassett says the U.S. government takes in about $185 billion a month from taxes and other sources, but pays out about $300 billion a month, which he calls unsustainable.

1 slash   

vi.大幅度削减；vt.猛砍，尖锐抨击，大幅减少；n.猛砍，斜线，长切口，衣衩

参考例句：

• The shop plans to slash fur prices after Spring Festival.该店计划在春节之后把皮货降价。
• Don't slash your horse in that cruel way.不要那样残忍地鞭打你的马。

2 economist   

n.经济学家，经济专家，节俭的人

参考例句：

• He cast a professional economist's eyes on the problem.他以经济学行家的眼光审视这个问题。
• He's an economist who thinks he knows all the answers.他是个经济学家，自以为什么都懂。

3 economists   

n.经济学家，经济专家( economist的名词复数 )

参考例句：

• The sudden rise in share prices has confounded economists. 股价的突然上涨使经济学家大惑不解。
• Foreign bankers and economists cautiously welcomed the minister's initiative. 外国银行家和经济学家对部长的倡议反应谨慎。 来自《简明英汉词典》

4 savings   

n.存款，储蓄

参考例句：

• I can't afford the vacation,for it would eat up my savings.我度不起假，那样会把我的积蓄用光的。
• By this time he had used up all his savings.到这时，他的存款已全部用完。

5 relatively   

adv.比较...地，相对地

参考例句：

• The rabbit is a relatively recent introduction in Australia.兔子是相对较新引入澳大利亚的物种。
• The operation was relatively painless.手术相对来说不痛。

6 premium   

n.加付款；赠品；adj.高级的；售价高的

参考例句：

• You have to pay a premium for express delivery.寄快递你得付额外费用。
• Fresh water was at a premium after the reservoir was contaminated.在水库被污染之后，清水便因稀而贵了。

7 investors   

n.投资者，出资者( investor的名词复数 )

参考例句：

• a con man who bilked investors out of millions of dollars 诈取投资者几百万元的骗子
• a cash bonanza for investors 投资者的赚钱机会

8 impasse   

n.僵局；死路

参考例句：

• The government had reached an impasse.政府陷入绝境。
• Negotiations seemed to have reached an impasse.谈判似乎已经陷入僵局。

9 deficit   

n.亏空，亏损；赤字，逆差

参考例句：

• The directors have reported a deficit of 2.5 million dollars.董事们报告赤字为250万美元。
• We have a great deficit this year.我们今年有很大亏损。