Lott: ‘There’s Time’ to Save US From Debt Catastrophe

It’s probably too late to fix the damage done to healthcare and stop the destruction of private health insurance over the next year in the United States, according to economist and author John Lott.

“I don’t think [President Barack] Obama’s willing to do the things that are necessary to fix it,” Lott told Newsmax TV in an exclusive interview.

He also warned about the nation’s publicly held federal debt, pegging it at about $200,000 for a family of four. But he said "there's time" to pull the nation back from the brink of a debt catastrophe.

“That’s a huge amount,” he said. “We’re adding about $1 trillion more to it each year. When we run up that huge debt, it means we’re going to have to pay higher future taxes and � in order to pay that pack, [it] retarrds growth today,” he said.

"But there’s time before it gets catastrophic for us to try to restrain the growth in debt and also help grow the economy," said the author of “At the Brink: Will Obama Push Us Over the Edge?”

Lott also mentioned that federal government spending rose 21 percent after inflation during the first years of the Obama administration.

“He originally promised that the stimulus was just going to be temporary, that it was going to be one ‘maybe two years,’ ” he said. “And now we’re into the fifth year of his presidency and he’s telling us that it’s impossible to even slow the range of growth of government. The arguments that he’s making are wrong.”

“One of the reasons for writing 'At the Brink' is to explain that and hopefully give people some determination to follow through with the necessary reductions in the rate of growth and government that we need," he said.

Lott also discussed the $85 billion in federal budget cuts resulting from the sequester. He said these cuts can be a positive development for the economy.

“Money has to come from someplace, whether it’s taxes or whether [the government] borrows,” he said. “The government is moving money from where you and I would have spent it to where it wants to have it spent. That doesn’t increase total spending.”

The strength of the economic recovery is a concept Lott doesn’t accept.

“The economy is well below its trend level,” he said. “We’ve never had a recovery that’s had such slow economic growth in terms of income and in terms of jobs. Real spending power has been falling over the last few years.”

Lott asserted that while housing prices have bottomed out, “they still haven’t really recovered much at all.” He attempted to put spending trends into perspective by comparing the current environment to the administration of President Bill Clinton.

“If you took government spending at the last budget that President Clinton proposed and had it grow at population and inflation to keep real spending per person the same, we’d have a $100 billion surplus right now, rather than a $1 trillion deficit,” he said.

“We just can’t keep doing that for a long period of time. Somebody down the road is going to have to pay for that and at that point it’s going to harm the economy.”