Article Image
IPFS News Link • Economy - International

In Greek Debt Crisis, Some See Parallels to U.S.

• New York Times
It’s easy to look at the protesters and the politicians in Greece — and at the other European countries with huge debts — and wonder why they don’t get it. They have been enjoying more generous government benefits than they can afford. No mass rally and no bailout fund will change that. Only benefit cuts or tax increases can.

Yet in the back of your mind comes a nagging question: how different, really, is the United States?

The numbers on our federal debt are becoming frighteningly familiar. The debt is projected to equal 140 percent of gross domestic product within two decades. Add in the budget troubles of state governments, and the true shortfall grows even larger. Greece’s debt, by comparison, equals about 115 percent of its G.D.P. today.

The United States will probably not face the same kind of crisis as Greece, for all sorts of reasons. But the basic problem is the same. Both countries have a bigger government than they’re paying for. And politicians, spendthrift as some may be, are not the main source of the problem.

We, the people, are.

We have not figured out the kind of government we want. We’re in favor of Medicare, Social Security, good schools, wide highways, a strong military — and low taxes. Dealing with this disconnect will be the central economic issue of the next decade, in Europe, Japan and this country.

1 Comments in Response to

Comment by stephanie mcnealy
Entered on:

 The single most important item that prevents the US from addressing the deficit is the ideology of reduced taxation. As long as Americans keep drinking the Kool Aid that all fiscal problems can be solved without increasing government revenues no solution is possible. There is waste in government, particularly in the military and tax favors to corporations, which should be tackled. Reducing Medicare and Social Security benefits is only necessary if the government is unwilling to collect the needed funds. But it is impossible to reduce expenditures by sufficient amounts without a full fledged revolt by voters (see Greece). Politicians in this country are not known for there willingness to confront voters.
Taxes will eventually go up, it is inevitable. The political question is for whom? The GOP has consistently acted to benefit the wealthy and well connected. If the raising of taxes occurs during a Republican administration you can be sure they will design them in such a way that the wealthy will be the least affected.
Stephanie Mcnealy

Customer Service Team