The state of US finances is getting worse given the state of US debt now running at $14.173 trillion, just marginally below the allowed limit of $14.294 trillion.
Now we have Bill Clinton's former Budget chief Alice Rivlin warning that America is not far off from a sovereign debt crisis. "We used to think that only happened to small countries on other continents, but it could happen to us as well," Rivlin told CNN's State of the Union. "That means that we would not be perceived as able to get our act together and pay our debts and our creditors would lose confidence in us."
The only way around it, she says, is for Congress to either rein in spending or increase US taxes. And there's no sign of that happening. Congress is not tackling the problem. What they're doing instead is the equivalent of arguing about the bar prices on the Titanic.
Add to that the findings from the Sovereign Fiscal Responsibility Index that the US ranks near the bottom of developed global economies in terms of financial stability. The top five countries for financial management are Australia, New Zealand, Estonia, Sweden, China and Luxembourg.
Given that Congress is unlikely to resolve the burgeoning debt problem, or increase taxes, a sovereign debt crisis for the US could be on the cards.
That will devastate the global economy. And that includes Australia, New Zealand, Estonia, Sweden, China and Luxembourg.
Interesting, but you mention the “top five countries” and then list six.
Congress is a ship of fools. They keep right on spending us right into bankruptcy, the most incompetent Congress in American history. They indulge freely in fiscal insanity and it is nothing but sheer selfishness! What a selfish leadership it is that would pass on even higher and more monstrous debt to its own children! There is no excuse for it. The American people should rise up and toss them out of office.