TightWind is written by Kyle Baxter. Stay Hungry. Stay Foolish.

Former acting CBO director Donald B. Marron has a fabulous look at why why our public debt is so dangerous, and what should be done about it:

First, once our economy is back on its feet, prolonged deficits and mounting debt will inevitably undermine economic growth. Americans simply do not save enough both to lend the government everything it needs to finance persistent deficits and to continue investing in the growth of the private sector. Future government borrowing will therefore require either more borrowing from abroad or significantly less domestic investment. If we reduce our domestic investment — building fewer factories, cutting back on research and development, and generating fewer innovations — our nation’s future earnings prospects will dim, and our future living standards will suffer. And while borrowing more from foreign lenders enables us to afford more investment today, that money (plus substantial interest) will eventually have to be repaid. As a result, more of our future income will have to be sent overseas — and again, our living standards will decline. Sometimes economics can be painfully simple: The more money we borrow now, the less we will have in the future.

Read the entire thing. We must reduce our debt to sustainable levels, and that means a significant reduction in spending and, unfortunately, tax increases.

This is precisely why the healthcare reform passed is so monumentally dangerous: our current spending and debt is unsustainable, yet we’ve decided to (1) tack on $100-200 billion in new spending a year, and (2) use up valuable means of cutting the budget.