The United States should be running surpluses instead of deficits to help fund entitlement programs for an aging population, former Federal Reserve Chairman Alan Greenspan told Fox Business Network on Thursday.
"This is something we saw," Greenspan told host Neil Cavuto on "Cavuto: Coast to Coast."
Despite knowing about the coming problem for 25 years, "nobody has done anything about it, and this is the crisis which has come upon us," Greenspan said. "It's slowing productivity because entitlements are crowding out savings and hence capital investment."
Capital investment is a critical issue for productivity growth, and productivity growth in turn is the crucial issue in economic growth, he said.
"So we're running at the end of the period to a state of disaster unless we turn it around."
Greenspan said the issue should be a priority in the presidential debate, though he doesn't see it leading to a recession. He sees it as worse.
"Our problem is not a recession, which is a short-term economic problem," he said. "You have a very profound long-term problem of economic growth at the time when in the Western world there is a very large migration from being a worker into being a recipient of social benefits as it's called.
"We're not going to be able to fund what we already are legally obligated to spend."
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