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Last time I checked, GDP is substantially less than $17 trillion so our debt is actually closer to 105% of GDP. Yeah, basically the same financial situation that Greece finds itself in.
What makes our crisis substantially worse is the fact that 10,000 Baby Boomers are retiring every day which puts even further strains on Social Security and Medicare.
First, as of right now our exact number for GDP is $16.633.4 trillion. That's not substantially less than exactly $17 trillion. I rounded up.
To compare the economies and fiscal issues of Greece and the USA and conclude that we are basically in the same boat as Greece or worse off could only be done so out of ignorance. Greece has far more structural problems than the USA does. We control our own currency and it happens to be the world's currency. Greece doesn't control their own currency and they are a part of the flawed Euro system. The USA's economy is diverse and dynamic, not the case with Greece. The USA's labor market is far stronger and more flexible than Greece's. The USA is in a far stronger position compared to Greece.
debt isnt the result of capitalism. It is the result of government power players spending money the dont have to keep themselves in power.
For the ruling class, debt is the cost of power.
Well, that is not what I said anyway. What I tried to say is that capitalism splits society into a few winners and lots of losers, even if it is relative. Still the differences are big enough to make politicians fear societal problems if they don't try to help the losers catch up, at least in terms of the result. And at the end of the day that often means money.
Ding, Ding, Ding, we have a winner. I'm still paying tax on alcohol that was enacted to help the people of Johnstown recover from a flood in in 1936.
Very true. And everyone who has a cell bill gets slapped with a tax that on average is 17.2%, part of which supports rural telephone infrastructure buildouts. That same tax has been on landlines since the 1930's.
Last time I checked, GDP is substantially less than $17 trillion so our debt is actually closer to 105% of GDP. Yeah, basically the same financial situation that Greece finds itself in.
What makes our crisis substantially worse is the fact that 10,000 Baby Boomers are retiring every day which puts even further strains on Social Security and Medicare.
As far as Greece is concerned, the US has much less debt (Debt:GDP) than Greece. Also worth noting is the pattern over time. Greece ran up debt relative to GDP at a fairly good clip even during good times, while the United States — despite the Bush administration’s best efforts — did not. So America does not have a comparable record of sustained fiscal irresponsibility; we’ve only developed large deficits in response to the crisis, which happens to be exactly when we should be running large deficits.
And that’s not even to get into the issue of us having our own currency.
One more thing: even if you believe, despite all this evidence, that we resemble Greece, what does that say? Fiscal austerity in the face of a depressed economy does little to improve your long-run debt position.
Next, according to the CBO, the debt is sustainable and the deficit is shrinking.
Quote:
If the current laws that govern federal taxes and spending do not change, the budget deficit will shrink this year to $642 billion, CBO estimates, the smallest shortfall since 2008. Relative to the size of the economy, the deficit this year—at 4.0 percent of gross domestic product (GDP)—will be less than half as large as the shortfall in 2009, which was 10.1 percent of GDP.
As far as Greece is concerned, the US has much less debt (Debt:GDP) than Greece. Also worth noting is the pattern over time. Greece ran up debt relative to GDP at a fairly good clip even during good times, while the United States — despite the Bush administration’s best efforts — did not. So America does not have a comparable record of sustained fiscal irresponsibility; we’ve only developed large deficits in response to the crisis, which happens to be exactly when we should be running large deficits.
And that’s not even to get into the issue of us having our own currency.
One more thing: even if you believe, despite all this evidence, that we resemble Greece, what does that say? Fiscal austerity in the face of a depressed economy does little to improve your long-run debt position.
Next, according to the CBO, the debt is sustainable and the deficit is shrinking.
A few months ago some financial expert said that the critical threshold of debt in percent of GDP, that is often used by the IMF etc., is arbitrary. There is no established percentage beyond which there would automatically be problems because of that debt. It all depends on lots of factors which vary a lot from country to country.
Well, that is not what I said anyway. What I tried to say is that capitalism splits society into a few winners and lots of losers, even if it is relative. Still the differences are big enough to make politicians fear societal problems if they don't try to help the losers catch up, at least in terms of the result. And at the end of the day that often means money.
I can accept that critisim of my comment. context is king and I appoligize for the take off....
I would however aruge that there is a big difference between the capitialist economic system and the governments that run nations. I would also say that while there is still a great difference between the wealth and poor everywhere in the world, those nations that have the most robust capitalist systems like American and Europe have produced a softer bottom for the poor and a vastly larger middle class than commuinsts systems.
A few months ago some financial expert said that the critical threshold of debt in percent of GDP, that is often used by the IMF etc., is arbitrary. There is no established percentage beyond which there would automatically be problems because of that debt. It all depends on lots of factors which vary a lot from country to country.
wow we agree!
it is absolutly true that you cannot compare a country like the USA and Greece as has been stated here already.
there are all kinds of factors that come into play.
I can accept that critisim of my comment. context is king and I appoligize for the take off....
I would however aruge that there is a big difference between the capitialist economic system and the governments that run nations. I would also say that while there is still a great difference between the wealth and poor everywhere in the world, those nations that have the most robust capitalist systems like American and Europe have produced a softer bottom for the poor and a vastly larger middle class than commuinsts systems.
Yes, that is why I wrote that the differences are relative. Of course the poor in the West are doing way better than those in most other regions of the world. But also because we invest a lot to close that gap, for instance via social security etc. Look at India, it has some extremely rich people, but we in the West could simply not accept so many people living without running water, sanitation, etc. In India they still seem to accept that. When they implement social security, health insurance and similar systems that deserve that name, they will pile up debt as well. In the West there is a certain minimum standard of living, below which there might be riots etc.
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