C. Ross Tobaire
The country of Greece is on its knees, desperately hoping for a “bailout” from the European Union. Excessive government spending and massive debt threaten to bankrupt this nation unless outside assistance arrives quickly. With a budget deficit this year of 12.7% of its gross domestic product (GDP), and consumer public debt exceeding 113% of its GDP, there doesn’t seem to be much hope left.
Greece is not alone in dealing with financial catastrophe. Portugal, Spain, and Ireland are some of the other EU nations that are currently staring into the abyss. One of the only questions remaining is, if the dominoes start falling, how long till the weakened U.S. economy crumbles as well? Not possible you say… well, consider this:
According to the 2008 CIA World Factbook, Greece had a government debt to annual GDP ratio of 90.10%. In 2008, the United States was at 60.8%. In 2009, the United States was at 83.41%, and according to usgovernmentspending.com it is projected to reach 94.27%. In essence, the entire value of everything produced by everybody in America for an entire year will roughly equal our federal debt. Note, that this doesn’t take into consideration the debt of the states, cities, towns, and most importantly, the consumer public debt.
All told, if Greece’s debt load is so unsustainable that collapse is immanent, then how far off is the United States from the same fate…especially if we keep seeing more Trillion dollar plus budget deficit bills like that of 2010.