For the past several years, an argument has raged about about the U.S. should deal with its lousy economy and debt-and-deficit problem.
On the one hand are the "austerians," who think the U.S. should immediately cut government spending to balance its budget, "taking our medicine" in one painful dose.
On the other hand are the Keynesians, like Paul Krugman, who think the U.S. should launch more government stimulus, increasing the debt in the near-term, but helping the economy to grow out of the problem.
One of Krugman's nemeses over the past few years has been Harvard professor Niall Ferguson, the author of a new book called CIVILIZATION: The West And The Rest.
Professor Ferguson has been screaming from the rooftops about the risks of piling up too big a debt-mountain, and he's not backing down now.
Countering Krugman's argument that today's low interest rates show that no one is worried about lending money to us and, therefore, that we should borrow and spend our way to prosperity, Ferguson argues that today's interest rates are irrelevant. When countries get into trouble, Ferguson says, they get into trouble quickly, the way Greece and other European countries have.
Taking on huge new debts now with the assumption that interest rates will remain low forever, says Ferguson, is like playing "Russian Roulette." The time to get our fiscal house in order is now, before the crisis, not once interest rates begin to climb and it's too late.
Importantly, Ferguson says he is not in favor of radically chopping government spending in the next year or two, clobbering the economy in the process. Rather, he says, the government should develop and implement a sound 10-year plan, one that phases in the cuts and eventually gets on solid footing.
And what happens if we don't?
If we don't, Ferguson says, we'll eventually pass the point of no return. And then we'll be forced to do what Greece has done: Make such drastic cuts that we get into a "death spiral" in which the each new cut shrinks the economy and increases the deficit and debt--the very problems that such cuts are supposed to address.
SEE ALSO: Niall Ferguson's Guide To The Coming Economic Apocalypse