Sunday, May 01, 2005

America the Broke, by Lezah

America the Broke

University of Arizona economist Gerald J. Swanson is decrying the state of the union.  He is predicting a 'fiscal Armageddon' based on run-away government and personal spending, as well as what he refers to as the 'inevitable collapse' of the US paper $ standard.  He points out that in thirty years, American has gone from being the world's biggest creditor to being the world's biggest debtor.  Since 2002, the US dollar has gone down 30% compared to the Euro.  By 2002, the national debt was $7.3 trillion (approximately $25,000 per citizen).

As well, personal savings are at an all-time low - the average being under 2% of one's income.  Swanson claims that the most useful thing in a case like this is restraint -but ain't our society today all about the bling?

Case in point:  earlier this week, I was out with a group of people I hadn't seen for about four years.  The average age of the group was 25.  I'm sure that the average debt load each of these people was carrying was well in excess of my own - and that was only for their accessories.  Chanel sunglasses, Vuitton purses, HUGE Rolex watches, MASSIVE diamonds (guys and girls both) - crikey!  And don't get me started on the Hummer.  Or the Mercedes.  Can you spell ostentation?

What do these people do for a living, I wondered?  Frankly, I was afraid to ask.  When you get people of that age flashing that much cash (literally and metaphorically speaking), it basically comes down to a few choices:  a really good, high-paying job (doubt it); inheritance (possibly); criminal activities (I wouldn't rule it out); or, behind the final door, Vanna:  a huge debt load (probably).

But are they happy?  Who knows.  Let's just hope, for their sake, that interest rates don't go up, otherwise you can expect to see some shaved-headed guy hawking his Hummer down at the flea market...


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