10:00am

Fri July 15, 2011
Business and the Economy

Debt Ceiling Debate Impact on Kentucky

More than politicians on Capitol Hill are taking stock in the current U-S debt ceiling debate.  University of Kentucky professor of economics, John Garren says finding a solution to long term debt can be a confidence builder for Kentucky business people.

“Confidence in the environment that if you invest now that there will be an environment in the future that you can rely on that you’ll make your money back and not that it’s all gonna be taxed away or inflated away with or the government printing money,” said Garren.

As the debate over the debt ceiling continues in Washington, businesses in the Commonwealth could learn from the eventual outcome.  John Garren says the result could affect decisions about creating jobs.

“Businesses are reluctant to invest in either equipment or people and that make jobs all that much harder to find and the less investment that happens both in jobs and in people the less will be our productivity growth,” added Garren.

Garren suggests policy makers in Washington might be best served by agreeing to cut spending while raising the debt ceiling.  He says that would send a positive message to the financial markets.