Who will be the next Greece? The United States?
Posted by xthinker88 9 years, 10 months ago to News
According to the article, Greece's debt is about 300 billion euros or 180% of its GDP. I've always thought comparing debt to GDP is a false comparison because the government cannot collect the GDP (even the government of Thompson-Mouch 2016). The Greek government is projected to receive 79.47 billion euros in revenue this year. So, to me, the more valid comparison is debt to income or 300/80 = 3.75:1.
What I find interesting when making this comparison is to then carry it to the US where the debt is now $18.3 trillion and the annual revenue of the federal government is $3.1 trillion for a debt to income ratio of 5.9:1.
On top of this, the US debt used in this calculation does not include unfunded liabilities. I'm not sure if the Greek number does but my guess is that the Greek number is actually a more firm total debt number than the US because it has more scrutiny as an economy that is not "too big to fail."
Makes me wonder how anybody can think that the current level of US debt is sustainable.
What I find interesting when making this comparison is to then carry it to the US where the debt is now $18.3 trillion and the annual revenue of the federal government is $3.1 trillion for a debt to income ratio of 5.9:1.
On top of this, the US debt used in this calculation does not include unfunded liabilities. I'm not sure if the Greek number does but my guess is that the Greek number is actually a more firm total debt number than the US because it has more scrutiny as an economy that is not "too big to fail."
Makes me wonder how anybody can think that the current level of US debt is sustainable.
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