PeR­Cent lec­ture with Laurence J. Kot­likoff, Bo­ston Uni­ver­sity

The Pension Research Centre (PeRCent) is pleased to invite you to a public lecture with Professor Laurence J. Kotlikoff, Boston University, one of the world’s leading voices on fiscal sustainability, generational accounting, public finance and long-term economic policy.

Laurence J. Kotlikoff is a Professor of Economics at Boston University, President of Economic Security Planning, and a New York Times best-selling author. He is a Fellow of the American Academy of Arts and Sciences, Fellow of the Econometric Society, Research Associate of the National Bureau of Economic Research, and Director of the Fiscal Analysis Center.

He has written 19 books and hundreds of professional articles and op-eds. His columns have appeared in The New York Times, The Wall Street Journal, The Financial Times, The Boston Globe, Bloomberg, Forbes, Yahoo.com, Fortune, and other major publications. In 2014, The Economist named him one of the world’s 25 most influential economists.

The lecture will offer a rigorous and policy-relevant discussion of fiscal sustainability and the long-term challenges facing the U.S. economy. 

Abstract:
The inability to spend beyond one's means -- the need to live within one's budget -- is economics' most fundamental law. It applies to entire economies as well as their household and government sectors. Official debt is presumed to signal government budget violations. But official debt measures only those obligations governments choose to label 'official'. Moreover, this labeling choice has no basis in economic science, whose equations don't direct their description. Thus, official debt is a matter of linguistics, not economics. Any country's past, present, and future fiscal policy can be relabeled to produce any past, present, and future values of official debt. In short, government debt is no better grounded in reality than the emperor's new clothes. If official debt is a number in search of a concept, how should we assess a country's fiscal sustainability? Economics' answer is the fiscal gap -- the imbalance in the government's intertemporal budget. The US fiscal gap now exceeds 7 percent of annual GDP. Closing the gap requires either raising all taxes by 26 percent or cutting all non-interest spending by 23 percent on an immediate and permanent basis. Such adjustments are politically infeasible. What can work is very specific, very simple, and very radical reforms of healthcare, Social Security, taxes, and welfare.

No registration is required.

For further information, please contact professor Svend Erik Hougaard Jensen at shj.eco@cbs.d