We have seen a partial down payment of the benefits of better budget balance already: It seems reasonable to assume that the decline in longer-term Treasury yields last year owed, in part, to reduced competition -current and prospective -- from the federal government for scarce private saving.
However, additional effort remains to be exerted to address the effects on federal entitlement spending of the looming shift within the next decade in the nation’s retirement demographics. BIS Review 15/1998  -2-  As I noted earlier, our nation has been experiencing a higher growth rate of productivity -- output per hour worked -- in recent years.