Is our economy doomed?

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?

Capitalizm has doomed us all.. i wonder when you people will get it through your heads, 89 countries find themselves worse off economically than they were in the early 1990s. Capitalism promised that globalization would narrow the gap between rich and poor. Instead the divide has widened. The 356 richest families on the planet enjoy a combined wealth that now exceeds the annual income of 40% of the human race.

So are you a socialist? Communist? What are you?

If you are any of those two or its' affialited parties I've got news for 'ya. Neither of those two have lasted at all. Period.

-wD

Its not capitalism that is dooming us. It's the widescale corruption, but it looks like you get that with almost any government system if there is a large population.

[edit added] Maybe there is an upper limit to how large any one political entity should be. Some of the problem is the federalization of rights and dutys formerly held by states, ie: smaller political entities. Who knows. I have no solution to this but I agree that our current economy is probably unsustainable. [edit end]


[edit on 24-6-2005 by Ambient Sound]

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?

If you mean is US national debt a problem for the US, then yes it is, particularly foreign debt.
The debt in the united states is higher now than ever, although compared to gdp it is lower than it has been in the past, as long as you believe governemtn gdp figures are correct.
In any case it is still higher in real terms and rising all the time.

It seems that the more pressing problem, as in argentina i believe, is inflation. The governments core rate statistics are deliberately misleading which is a sign of a problem.
Needless to say i think you should be looking shorter term than 2040 for potential problems.

Impeach BUSH! TAKE HIS MONEY AND DEFER IT TO THE FAMILIES OF OUR DEAD SOLDIRES AND THEN LET THE TRUTH BE TOLD ABOUT 9/11. Then we can be at peace!

What other economic system will take its place? No other modern system has lasted longer.

Doomed isn't the word I'd use except to instill fear. Change would be a better choice.

The economy is changing from one based on easy energy to one of higher energy cost. This drives every other price. At some point in the not too distant future, inflation will be talked about. Don't expect this until after the election as it would have an impact on who gets votes.

As for the $150,000 per citizen cost, this is one of those false numbers that you see thrown around by people who do not like America or the current administration.

This number would go into the plus side if every resource owned by the government was allowed to be used for economic gains. This includes protected forest land and oil reserves not allowed to be tapped for some silly environmental law. Basically, it's resources for future generations, but the value of that resource is not included because it makes the doomed economy look prosperous, which disproves the point of the false article.

Our, America's Economy, crashed somewhere back in 1998. However it's been on lifesuport since then. "They" don't want to tell you this however.