Culture of debt

Seth’s Blog had a fact that had my head spinning today.

for the first time in 70 years. In 2005, Americans spent more than they earned.

Let’s put this in perspective. I am sure UK citizens are doing the same thing, “march of the chavs” progresses ever further. What is scary is the rest of the world depends on the USA either directly or indirectly. The economic powerhouse of the world, our financial engine, is basically in debt up to its eyeballs with economic growth largely dependant on a housing market bubble.

I thought I would read more into this, look at the sort of thing I found:

“In November alone, consumers spent $19 billion more than their income, according to a report by the U.S. Department of Commerce.”

“Economists say that current levels of consumer debt cannot be sustained over the long term. Many economists forecast that consumers will cut spending sharply in the first half of the year, as they struggle to pay their holiday shopping bills”

“Their credit cards are maxed, their energy bills are going up and they have less ability to borrow against home equity because interest rates are going higher”

“Since taking office in 2001, President Bush has transformed a national budget surplus into a string of
multibillion-dollar deficits that included three of the biggest deficits in the nation’s history.”

“Over the past several years, the federal government has relied on the central banks of China, Japan and other
nations to bankroll its deficit by buying U.S. treasuries.”

The country and its citizens have gotten addicted to spending and to hell with the consequences. And what might those consequences be? I shudder to think.

Wouldn’t take much of a leap into science fiction to see a future where China gets pissed off with USA and bankrupts them …