March 2nd, 2009 at 4:27 pm”The US with its war and debt is much more like France and Britain were before the start of WW-II. Cheese eating surrender monkeys anyone?”

…..Please note the cheese eating surrender monkeys volunteered for a war with the most formidable military power in the world at the time which they knew would be fought on their territory while the steak eating macho men a comfortable 3000 miles away from any bullets had to be forced into it….But don’t let historical facts get in the way……..

…..So what is it going to be then?……13.7trillion…….so as % of GDP it jumps to maybe 15% or thereabouts…..doesn’t really alter the perspective does it….Doomsayers chill out…. I think back in 1943, the highest it ever was it hit about 40%…..a bit better than Germany today…..

Sadly, there is a way. If the USD is devalued sharply you could see GDP figures that are higher than $14.5 trillion even as the real economy collapses.

“One of the few differences between the US and other countries (and its not consistent and only for a few decades) is that we tend to expect value for tax money spent”

Even monkeys expect a fair return in exchange for a grooming. What country were you thinking of whose people do not expect value for money spent? Does such a place even exist? Even the loosest spenders today are looking for social or economic stability in return for the billions being shoveled out. They may have a different value structure and probably have tactical differences from you and given the multitude of theories out there, someone is definitely wrong. But that does not mean that anybody is spending money with expecting value in return.

Comparative deficit/GDP is interesting, but now compare that to total national debt/GDP. That’s more telling. A large short term deficit is different from a massive national debt.

why would that be any more telling? if they are running a deficit this year, the odds are they were last year, and the decades before that.

One of the few differences between the US and other countries (and its not consistent and only for a few decades) is that we tend to expect value for tax money spent. and we also tend to demand and require competency from our government (at least normally we do). thats not been the case for a majority of countries.
and i am not sure if we got number from China if we could believe them.
not that we can trust ours much more, but there are times they will at least let us see the reality of whats happening.
and while we can fret about finding lots of money because some of our business leadership have led us over a cliff, there is no body left to pick up the pieces of what they have trashed. and unless you think the US is going to collapse in a less than a decade and the rest of the countries won’t (even if they are in worse shape), the amount of money borrowed isn’t that a big of a problem. because if the US collapsed
there wouldn’t be much of the rest of the worlds economy if any

“how are the Chinese doing… are they still expected to have 8% GDP growth???”

Does not matter. They have no deficit. Zero divided by any number is still zero!

Barry, I think the “systemic collapse” call is too dire. At Bretton Woods, we were able to pull off a systemic transition without total collapse and the situation then was far worse. For all the Great Depression analogies flying around these days, people forget that it is not the US this time but China that is the isolationist net creditor that has yet to figure out how to flex its muscles and put its idle capacity to use and restore some order in the world system. The US with its war and debt is much more like France and Britain were before the start of WW-II. Cheese eating surrender monkeys anyone? :)

When this has little to no positive effect, what will the Keynesians say then?