Debt, a Word of the Past

World Debt

The Facts

The word debt having any meaning is a thing of the past.

Once it meant something you owed, something you were going to pay back an I.O.U. something to what you had, an obligation.

Now it seems to mean nothing, except a deficiency in what you wanted to have.

Globally, all the nations of the World owe $40,000,000,000,000. More than one third of that is owed by the United States, $14,500,000,000,000.

That means that every person in the US owes $46,500.

What is wrong with these figures?

Per Capita debt by Nation:

Japan $82,000

US $46,500

Canada $36,000

EU $25,000

Brazil $5,800

South Korea $4,600

Mexico $3,327

Cuba $2,085

Sudan $1,207

Russia $852

India $704

China $684

Pakistan $433

Ethiopia $118

Ah, I hear the Blue Suits say, “It is not how much you owe that matters, it is your ability to repay it that counts”.

I say, that is a crock. The ability to pay it back does not matter, it is the INTENTION to pay it back that matters.

The US politicians are now arguing as to how much to raise the deficit by, not how to pay it back.

For years I have heard it said: in order to make money we first have to borrow more. Hello, you’ve been trying that for years already, it isn’t working. It may in some situations but no longer in that of the US.

For example: If you gave everybody in Ethiopia $46,000 each, yes, it probably would help the country. With their new found spending power, new businesses would open. Maybe factories, which would mean the country had to import less and even export more.

No Money for the Poor

More Facts

The voting public in the “rich” countries live quite well and in order for them to continue to live “above” the rest of the World, their Politicians, unilaterally, raise their debt ceiling.

When the “poor” countries want to raise the standard of living for their people, they ask the rich countries if they may borrow. The rich countries reply: yes, but only if, you can prove to us you have good fiscal controls.

For a good model for fiscal control, where should they look Japan, the US or Europe? I don’t think so.

The truth is, the rich countries do not want the poorer ones to raise their standards, if they did, then the rich would have to borrow even more to stay ahead.

This is what is called a FAIR market and international EQUALITY. Perhaps there are more words that used to mean something but are eroding, just like any forms of good budgetary management.

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Comments 4 comments

Storytellersrus profile image

Storytellersrus 5 years ago from Stepping past clutter

rafken, you have composed many interesting hubs but this one captured my attention first... Debt, a word in the past. I appreciate the implication; the historic concept "debt" has transformed, as no one actually expects to pay back what they owe. I have not considered this, until now.

I believe that there is a better way to define the world these days than by country. Country statistics generate stereotypes and around the world, people assume this is the way it is for everyone who lives in that particular country. Sadly, all Americans do not have a wealthy lifestyle. Many are homeless and should be categorized on a scale of quality of homelessness. Others are global citizens and their debt should be categorized with that of similar folk. Middle class Americans can only be truly represented when compared to the life style and debt of others in their economic category, etc.

My point is, defining these things country by country is not an accurate picture of life among earthlings. Though I did find the per person indebtedness fascinating, I do not find it relevant. Have you found any studies that discuss this issue from a more contemporary angle? Along with debt being a word in the past, classifying people by listing their countries as the common denominator has also undergone a transformation, in my opinion!

Voted up, useful and interesting. Thanks for tweaking my brain.


gogogo 5 years ago

something to think about, I always heard Politics corrupt, and it seems to be true, there is no one honest or responsible to say enough is enough. Lets do what is the best to the USA, for for our political position.


CHRIS57 profile image

CHRIS57 5 years ago from Northern Germany

Interesting hub, worth a second thought.

Is this really about how much public dept has been accumulated? I don´t think so. It is also not about the rich and the poor countries.

The real question is: if you take a credit, can you pay it back on the long run and can you cover interest rate in short and medium terms.

If dept is backed by collateral, the first question is almost answered, that is why Japan can afford an uncomfortably high public dept. Japan simply has enough private wealth, money and assets to stand in for the public dept.

What about the US? That is already a delicate issue. Assets (private, corporate and public) are just high enough to cover the dept, but the short term question remains unanswered, because it is not only interest to be payed for but also for the lack of producing ability, the massive trade deficits. Because that is going on for decades, things start to get out of control. And with sluggish economy the private collateral to back the public dept is deteriorating. Just remember how assets just evaporate in case of default.

So the US is already at the brink to become unreliable, not because it could not raise the dept ceiling, but because in bad economic times the private and corporate assets diminish and can no more stand in for the countries dept.

Actually that is the same situation in Greece, Portugal, Spain, Italy and UK. All those countries have low productivity and (exept UK) not enough private collateral to service dept.

And - nobody gives money to Ethiopia, not because they have low dept but because the little dept just reflects their economic capabilities to stand in for a credit.

All those countries are in trouble, that live over their means, spending more in combination of public, private and corporate sector than they earn. And in this discussion only money counts that represents the value of goods, industrial products, commodities, but not service.

So for most economies on this planet things dont look bad. Only some of the rich countries have to worry, with the US in the lead.


PETER LUMETTA profile image

PETER LUMETTA 5 years ago from KENAI, ALAKSA

Rafken it seems to me that the whole international monetery system is rigged for the rich countries to control the poorer countries of the world. It is a huge game of monopoly that no one can win, only tread water. This game of chicken the President and Congress is playing has the potential to bring the whole system crashing down and at the least destabelize the world economy. Our lives are in the hands of Politicians, think about it.

Peter

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