This is the Cato Daily Podcast for Friday, September 4, 2009.

I'm Caleb Brown.

The White House now projects the 10-year budget deficit to be $9 trillion.

That's $2 trillion more than previously thought

so just how big is nine trillion dollars what is paying that debt back

paying the interest back mean for the US economy long term.

Jim Dorn, Vice President for Academic Affairs at the Cato Institute, comments.

Paul Krugman argues that $9 trillion really isn't all that much money necessarily.

He says that the debt as a share of GDP will be substantially less than it was at the end of

World War II.

It will also be substantially less than say debt in several

European countries back in the mid to late 1990s. Now a lot of people who

defended Ronald Reagan's policies during the 1980s used a similar argument.

They said that, look, we may have run up all this debt,

but our ability to pay it back has increased at a faster clip.

Well, we're actually growing a lot slower now than we used to grow.

And that's what, you know, our ability to pay back

depends upon our growth rate to a large extent.

Nine trillion, in most people's minds minds is a lot of money and in fact it's a it's about

40% of GDP right now and it's well excuse me our debt right now is about 40% of GDP in a decade from now it's going to be close to 70%

basically because we're adding another $9 trillion worth of debt in the next decade.

That estimate, by the way, $9 trillion is about $2 trillion more than was estimated about

...