American Debt And The Non-Intervention In Syria

[Khandro]

With the National debt of the USA now standing close to 17 trillion dollars isn't it time it declared itself bust, turned to domestic issues, and admit the days of policing the world are over, and what would be the outcome? http://www.bbc.co.uk/news/world-us-canada-24330034

[Old_Geezer]

"If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem."

I don't see what they have to gain by facing up to the reality of their economic situation. At least not yet. In fact who is to say their fortunes would improve if they stopped manipulating the international situations that they like to do ? Party like there's no tomorrow, spend like it's going out of fashion. It's only numbers on paper after all.

[Khandro]

...... and impoverish your children and grandchildren ?

[Gromit]

Communist China will keep em Going.

Ironic really.

[Old_Geezer]

No, they''ll do the same. Keep it running forever.

[Zeuhl]

/...... and impoverish your children and grandchildren ?/

China might implode before that

but if it doesn't, what would happen if the Americans one day just told their Chinese creditors to 'take a hike'?

or indeed, just refused to buy any of their stuff?

[Khandro]

But the debt isn't simply an accumulating theoretical amount, interest is being paid on a daily basis of over 700 million dollars. http://www.politifact.com/virginia/statements/2011/apr/26/randy-forbes/randy-forbes-says-us-pays-china-739-million-day-de/

[Old_Geezer]

They should tell them to add it to the slate :-)

[ichkeria]

This happens every year doesn't it?

[Gromit]

Before we get too smug, we should remember our debt has risen to above £1trillion. And it is China who have loaned us the dosh.

Osborne said he would balance the books when he was elected. Instead, the national debt and the deficit have increased.

Good old communists, where would we be without them?

[Gromit]

// This happens every year doesn't it? //

Mostly. Under the Clinton administration, the national debt was actually reducing, the first time since WWII. Unfortunately Bush Junoir took the US into two wars and its debts escalated.

[jno]

Clinton actually got them into the black, didn't he? I don't have the figures to hand, though.

[Gromit]

Don't think Clinton got them into the black. But he was the first President to leave office with the debt smaller than when he came in. There was still a debt, but it was hoing down.

[Old_Geezer]

My suspicion is that is probably more of a case of "good old large population nations who pay their folk little so get a lot out of them for not much cost."
More difficult to generate lots in the coffers where the people insist on a good standard of living as reward for their efforts. But if someone else knows differently ....

[emmie]

http://wiki.answers.com/Q/How_much_surplus_did_the_US_have_when_Clinton_left_office

[emmie]

no better than anyone else it would seem, worse in some cases perhaps.
nothing new for US to go way way over budget.... x

[Hypognosis]

China's biggest problem is a really wierd one: it is earning too much money from making all our goods for us.

They can't simply bring the pot of (dollar) earnings into their own economy without undermining their own currency, triggering an inflation spiral as bad as, or likely much worse than, 1930s Germany.

The only way they can safely deploy these massive stockpiles of money is to invest it every which way they can, elsewhere in the world. Sure a lot of it goes on infrastructure in developing countries (you need to build roads and railways to get mined ore to port) but the biggest place to soak it up is in lending to the USA and other developed countries.

I sometimes find it hard to judge whether China is functionally communist or capitalist. Maybe their workforces still run as collectives, maybe they don't? They apparently have a middle class segment of society - better educated in the big cities than in the rural provinces and so forth.

Perhaps the one crucial difference is that they kept the cost of living under control for longer than we did, which kept wages under control and, by avoiding the whole business of maintaining pay differentials and the "I'm worth more than you are" attitude (of one job type over another) which infected the unions in our part of the world and led to the annual round of pay-hikes to maintain those pay margins and the chronic inflation that caused (rises were always in percentages not absolute amounts, causing growth in the problem), they made their wage rates internationally competitive.

It is slowly dawning on the Americans that cheap goods at WalMart is all very good but that means tens of thousands who would have been employed at factories on home soil, generating income tax revenue in the process, have been put out of that work. Whereas they would have been, in theory, freed up to work in the manufacture of more high-value goods or more technically skilled, higher paying work, the reality is that most of them end up on the dole, drawing down more than they ever generated in income tax. Their reduced spending power means that every other manufacturer and service supplier loses business, have to cut staff and it's a long downward spiral for everyone thereafter.