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Originally posted by FreeThinking1
I read an article today that I felt was a little disturbing regarding a possible meltdown of the US economy.
"No republic in the history of the world has lasted more than 300 years…eventually the crunch comes.” David Walker, Comptroller General of the United States, recently made that statement at a meeting with The Heritage Foundation and The Brookings Institution to discuss the “budget nightmare” that threatens the United States. Mr. Walker explained that by the year 2040 the United States’ debt and obligations could total $45 trillion. To pay off this debt completely, every man, woman and child would be sent a bill for $150,000."
The article goes on to describe exactly how our debt could reach such astounding numbers. It also mentioned a New York Times article by Anna Bernasek entitled “The Outer Limits of National Debt,” which frames the debt burden in historical terms to theorize the level at which creditors would stop lending the U.S. money, possibly triggering an Argentina-style economic meltdown."
I did a little digging on this meltdown:
"In December 2001, President Fernando De la Rua resigned from office in the face of an imminent default on Argentina’s ballooning foreign debt, his government’s inability to pull the country out of a three-year economic crisis, and a series of grave public disorders followed by heavy-handed police repression. His fall from public grace came as a consequence of having embarked upon a series of highly unpopular public spending cuts designed to restore Argentina to financial health, while leaving untouched one of the root causes of Argentina’s economic meltdown—a massive debt to foreign banks that had eagerly lent money to both dictators and a corrupted political system."
I'll be the first to admit I am not an economist. This does appear to be a serious problem that I haven't heard a great deal about. I was hoping that by posting this someone with a bit more background on economics, or just someone who has figures and theories for or against, could shed some light on this issue. I think it's possible Mr. Walker could be overstating things. However, using Argentina as a model isn't it possible it could happen elsewhere? There may be factors I'm unaware of that couldn't pertain to our situation. Then again, maybe not. Thoughts?