Bernake has the opinion that the US current account deficit and high government debt is the result of developing countries not borrowing, but saving too much. See: Remarks by Governor Ben S. Bernanke At the Homer Jones Lecture, St. Louis, Missouri
Updates speech given on March 10, 2005, at the Sandridge Lecture, Virginia Association of Economists, Richmond, Virginia
April 14, 2005
The Global Saving Glut and the U.S. Current Account Deficit
However, he relies on accounting principles to defend his view. The biggest problem with this tactic is the following: “It can not explain why there is a global savings glut”.
Labor arbitrage can explain it. See Neoclassical Theory of Production.
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