U.S. public debt is approx 53% of GDP (not counting GSE debts): http://en.wikipedia.org/wiki/List_of_countries_by_public_debt https://www.cia.gov/library/publications/the-world-factbook/rankorder/2186rank.html
If you haven't noticed - those contained the word "est." which means estimate. Obama also included the Iraq and Afghanistan war costs - something Bush kept off the books. Thus, just US national debt alone - no GSEs included, today is over 13 TRILLION. http://www.usdebtclock.org/ You want something "official?" Here's a non wiki source - the Federal Reserve: Notice, this does not include 2010 to June of this year. Yet the debt is 12 TRILLION as of 2009 year end. Today, the debt just recently hit 13 TRILLION. http://newsfeed.time.com/2010/05/27/u-s-debt-tops-13-trillion-is-it-time-to-panic/ What is GDP? Do the math. I suggest you do some more research. And don't take "est." as an answer.... you gotta dig a little deeper than that. And by the way, all of the above numbers do not include state, municipal, or county debts or the GSE debts. I'm guessing these debts are the responsibility of us Americans, right? So why not count them... see my prior post. We're over 130% debt to gdp. Greece is a piker.
Either we pay the debt down before interest costs engulf a crippling percent of tax revenues (meaning less money for SS, Medicare, or defense), or we default. On interest costs: http://money.cnn.com/2009/11/19/news/economy/debt_interest/index.htm Those are the only two options we have. Unless war breaks out, and we default as an excuse, we will pay it. How will we pay it? We'll destroy the currency (inflation) or the economy thru rabid taxation - or both. That's how.
The economy is already destroyed. There are no jobs and all the state and local governments are bankrupt. War has already broken out. There are ongoing battles in Iraq and Afghanistan. Iran and Turkey want to start a war with Israel. They're threatening to break the sea blockade of Gaza by escorting "aid" ships with military vessels. When it comes to the last country standing, I'm betting on the US. They have superior firepower. USD is still the currency of choice.
That number is grossly misleading as it treats the non-existent social security "lock box" as being real. The gross federal debt - not including implied liabilities from all the GSEs but including all actual budgetary items - is much much higher than 53% of GDP.
It says 2009 estimate which means it was written sometime in 2008. Remember in Nov of 2008 we just broke the 10 trillion dollar mark. Today its over 13 trillion.
But guys... I'm sure the U.S. isn't the only country playing with the books. This means a few other countries will go before the U.S. does. Economies already tanked: 1 - Zimbabwe, (2 - Japan?), 7 - Italy, 8 - Greece, 11 - Iceland, 19 - Portugal, 27 - Ireland, 45 - Spain. That means in order for the US to go, the following would go first: 15 - France, 18 - Germany, 20 - Canada, 22 - UK, 25 - Austria, 31 - India. I do think things look bad right now, and the US could maybe be in for the second dip of the double-tip recession, but wait until the UK goes bankrupt around 2011-2012 and then I'll agree the US is heading that way too.
I thought this was an interesting response on another site: " http://voices.washingtonpost.com/ezra-klein/2010/05/galbrait... "Government does not need money to spend just as a bowling alley does not run out of points." "Since the 1790s, how often has the federal government not run a deficit? Six short periods, all leading to recession. Why? Because the government needs to run a deficit, it's the only way to inject financial resources into the economy. If you're not running a deficit, it's draining the pockets of the private sector. I was at a meeting in Cambridge last month where the managing director of the IMF said he was against deficits but in favor of saving, but they're exactly the same thing! A government deficit means more money in private pockets." "The way people suggest they can cut spending without cutting activity is completely fallacious. This is appalling in Europe right now. The Greeks are being asked to cut 10 percent from spending in a few years. And the assumption is that this won't affect GDP. But of course it will! It will cut at least 10 percent! And so they won't have the tax collections to fund the new lower level of spending. Spain was forced to make the same announcement yesterday. So the Eurozone is going down the tubes." "On the other hand, look at Japan. They've had enormous deficits ever since the crash in 1988. What's been the interest rate on government bonds ever since? It's zero! They've had no problem funding themselves. The best asset to own in Japan is cash, because the price level is falling. It gets you 4 percent return. The idea that funding difficulties are driven by deficits is an argument backed by a very powerful metaphor, but not much in the way of fact, theory or current experience." Because the government needs to run a deficit, it's the only way to inject financial resources into the economy. The central fact of economics is: The economy grows. The number of people on earth is still growing. The productivity of individual workers is still growing. We are capable of making more stuff in every year than we did in the previous year. Now, suppose the supply of money were finite. But the amount of stuff being made keeps getting larger. So, every year, the price of everything goes down, because there's an ever-larger supply of pizza and beer but a constant amount of money. But this creates a serious problem for the economy. Because now we've got deflation. And that produces a really big incentive to save. Too big an incentive. Everything will be cheaper tomorrow, so every individual benefits by burying money in the backyard and spending as little as possible. But as people bury more and more money, the economy shrinks, because there is less and less money to spend, and everyone is trying to hang on as long as possible without spending anything. You end up with lots of people sitting, unemployed, with tools idle, and resources idle, and money buried in the backyard, staring at each other and waiting for someone to make the first move. Because, thanks to deflation, the first person who spends anything is a relative loser. And now your economy has deadlocked. And that's why the government always runs a deficit, and why the inflation target is always higher than zero. The government prints money to make sure that the supply of money stays good. This produces some amount of inflation, of course, but the growth benefits of liquidity outweigh the inconvenience of having to do something more interesting with your money than bury it. (Why don't more people understand this? Partly it's because the growth of the economy is a historically new phenomenon, dating back only about 150 years. Before that, as far as we can tell, human economic production per capita barely grew throughout millennia of history: http://www.amazon.com/Farewell-Alms-Economic-History-Princet... The other cause for misunderstanding is that if you, say, define "gold" or "silver" as equivalent to money, and your society's economic productivity grows, but society's ability to dig up gold or silver grows exactly as fast as overall productivity at all times, the currency magically manages itself. Because of this, for a hundred years and more of the Industrial Revolution the world managed to struggle along with a gold-based money system. But, of course, the gold standard was abandoned when people finally figured out that this process is very haphazard -- indeed, it cannot be controlled. You can't discover gold overnight, but sometimes you need more money in the economy overnight. Like now, for example.)"
Yes the U.S. is in trouble if it keeps piling on budget deficit years. Maybe 3 or 4 more years to go though... U.S. Public Debt Excluding Intragovernmental Holdings, June 2010: $8.6 trillion (60.5% of GDP) U.S. National GDP, 2009: $14.2 trillion U.S. Budget Deficit, 2009: $1.4 trillion http://www.treasurydirect.gov/NP/BPDLogin?application=np http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nominal) http://www.bloomberg.com/apps/news?pid=20601103&sid=aA8lChe4zUQU