With all the talk on the debt lately, it seems like our country has a lot of problems. One would think that our debt is worse than other countries if you listen to the pundits. "We're going to become like Greece," is the phrase we hear most often.
Greece is actually second among the bigger economies of the world if you measure debt to GDP standing at 161 percent. We are at 95 percent of our GDP which is actually the fifth largest in the world today. So we have quite a ways to go to "become like Greece" although we might get there if people continue to be ridiculously unapologetic about dodging their taxes here as they do there.
If people really wanted to use scare tactics, they should say we could "become like Japan" which has a debt to GDP of 245 percent. Wow! Given this ridiculously high number, why are they still even functioning as a country? My buddies in the Tea Party have assured me that if we go over 100 percent, our nation will be ruined (never mind the fact that we have been over 100 percent before, have a 15 trillion dollar GDP, and have 65 trillion dollars of wealth in this country).
Given these figures and the fact that these countries, while in bad shape for a variety of reasons, are not ruined, should we completely lose our head about our debt?
18 comments:
..."why [is Japan] still even functioning as a country?"
Excellent question.
They use 60% of their tax revenue to pay the INTEREST on the debt.
They borrow the rest, to keep the country functioning. Like your government does. It's just not 60% for us yet.
Additionally, you'll see here:
http://www.nationmaster.com/graph/eco_deb_ext-economy-debt-external/AFR
that Japan's external debt to total debt ratio is actually quite average. The Japanese culture is very savings oriented, with a high value placed on working late into your life. Japanese citizens voluntarily ask the government to keep their money for them.
In 2002, Japan passed the 'age hump' of post-war births. When those pensioners (or their more Americanized heirs, more likely) start cashing Japanese T-Bills, Japan is in trouble.
Because they are in trouble, all those US Bonds the Japanese government owns may start being cashed as well.
Japan bought into Keynesian economics like good little vanquished peoples do. It was the hot new economic theory that the US was using.
Around 1970, lobbyists finally bought enough of the Diet to gain huge construction program contracts. Once the government decided it could buy votes and get rich from shady government use of power, it was a quick decline.
The Japanese Yen just hit a dire inflection point at 125 (USD$ comparo). Just something to look at, if you track the currency markets. It's a race to the bottom for the Euro, the $, and the Yen.
"should we completely lose our head about our debt?"
Of course not. Losing your head over anything is never a bad idea.
Will the US default? Of course.
Will it be Aug 2? Of course not.
Political theater, writ large.
(Note that I didn't quibble about any of your figures, but I didn't verify any of them. Just answering your questions.)
Ha! Make that 'never a GOOD idea'.
Maybe if we had a few less people being ridiculously unapologetic about maxing out the ole us govt mastercard we wouldn't even be having this conversation.
As to currently being 5th on the list, wouldn't you consider that being near the top (and not a good thing)? Where was the US on that list 10 years ago, or 20?
if people continue to be ridiculously unapologetic about dodging their taxes here as they do there
Ah, so you just use the 1040EZ and don't claim any deductions you are eligible to take?
Me, I'm willing to take advantage of whatever options exist to lower my taxes. No apologies, no guilty conscience.
And if Warren Buffett or George Soros still feels he isn't paying enough, he can follow your example of filing without deductions. If that isn't enough he can make a contribution as per that Treasury webpage.
Not exactly on point, but related about how the rich fuck you over by skirting regulations...
A letter to his investors dated Tuesday said the switch takes advantage of "an exception" in the Dodd-Frank financial legislation. Family offices, regardless of their size, won't face the same regulations being imposed on hedge funds and private-equity firms.
Copied from comments to a previous post:
* * *
Let's see if we can make this so simple even a teacher can understand it.
Let's say your monthly income is $3000, and your monthly bills are $5000, including the payments on loans you got so you'd have the money to live a $5000 a month lifestyle (because apparently you didn't have the spine to listen to the wife and kids whining about being poor). Obviously you can't afford to pay all these bills. Should you:
a) Demand a raise from your boss.
b) Go get another loan, so as to cover the loan payments you are already making and can't afford.
c) Get your buddy the counterfeiter to print a bunch of fake bills with which to pay your creditors.
d) Go out and buy more stuff on credit, and worry about the bills later.
e) Prioritize your budgeting and learn to do without all but $3000 worth of "stuff", even though this will have a negative effect on your credit rating and therefore your ability to get more loans.
You can choose more than one answer.
* * *
So according to this post, your answer is "D" then. Along with however much of "A" you think you can get away with.
Welcome to the fundamental change Obama promised us. I think he'll use this situation to bring about collapsing the system. Cloward & Piven anyone?
Anon:
Like any really good 'secret' machination beyond the average guys control, I wonder how so many people know about it.
If the C & P conspiracy theory is totally true, it still only speeds up the inevitable.
Governments rise. Governments fall.
I can't seem to find Yugoslavia on my map. And where in the Hell did Danzig go?
When the Transcaucasian Democratic Federative Republic fell, I stopped paying attention.
Danzig? Well, he was on tour with one of my favorite bands Devildriver earlier this year. You must have missed them...
Danzig Tour Dates with Devildriver
Fri/Apr-29 Las Vegas, NV House of Blues
Sat/Apr-30 Ventura, CA Ventura Theater
Mon/May-02 Salt Lake City, UT The Great Salt Air
Tue/May-03 Boulder, CO Boulder Theater
Wed/May-04 Kansas City, MO Voodoo Lounge
Fri/May-06 Austin, TX Stubb’s Waller Creek Amphitheater
Sat/May-07 Corpus Christ, TX Concrete Street Amphitheater
Mon/May-09 Orlando, FL Hard Rock Live
Tue/May-10 Atlanta, GA Center Stage
Wed/May-11 Asheville, NC The Orange Peel
Fri/May-13 Richmond, VA The National
Sat/May-14 Sayreville, NJ Starland Ballroom
Sun/May-15 Clifton Park, NY Northern Lights
Tue/May-17 Baltimore, MD Bourbon Street
Wed/May-18 Westbury, NY Westbury Theater
Fri/May-20 Pittsburgh, PA Stage AE
Sat/May-21 Columbus, OH ROCK ON THE RANGE*
Sun/May-22 Milwaukee, WI The Rave
Tue/May-24 Grand Rapids, MI The Orbit Room
Wed/May-25 St. Louis, MO Pop’s
Fri/May-27 Albuquerque, NM Sunshine Theater
Sat/May-28 Tempe, AZ Marquee Theater
Danzig is a pussy, last. Didn't you see the video with him and Marianinho? You gotta elevate your game.
Travers in 4 weeks.
http://www.youtube.com/watch?v=bvckzMp-bWA
Yep, this video is on my favorites list on my youtube channel. Not to mention, Danzig had a show booked at the Cabooze in Mpls earlier this year, took one look inside and said "We're not playing here" and walked out...show cancelled.
He's a jagoff.
Besides, what are you doing on Marks blog...aren't you in Nawlins eating cajun seafood?
Great. Now I've got to download the Danzig discography and try to catch up.
Fuckers.
I wish I'd said Visigoths.
Check out Fear Factory's CD Mechanize. I got it about 1 year ago and it hasn't been out of my CD player yet. Video on youtube for their song Powershifter is cool.
It's Monday morning and Danzig still sucks.
I love how this post has been hijacked by music. Being a music geek, I highly approve of this and hope it continues in other threads!
I have a serious chubby because Jaxon used the word "discography.":)
OK, I'll throw in the Avett Brothers just to shake things up a little.
If you know and/or discuss them, I'll overlook ignoring my previous post's points.
Eww, Mark, you just killed the thread for me. Just ... eww.
My favorite Danzig video:
http://www.fark.com/vidplayer/6445966
Hope I got that link right...
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