Just how bad is the US debt problem
Some interesting factoids over at Capital Gains and Games:
Point One: We often hear that the US government debt load is lower as a share of GDP than those of many other large, wealthy nations, including Japan, Germany, the UK and France. But a more apples-to-apples comparison, which combines federal, state and local government borrowing, suggests that the US is in worse shape than most other AAA-rated countries.
By that measure, the United States general government totalled 78.6 percent of GDP in 2009 and will hit 90 percent by the end of 2010, Fitch says. That would make us the the most highly leveraged of all AAA-rated countries — Germany, France, the UK, as higher than that of almost all other AAA-rated nations. (Japan’s debt is still much higher, but it lost AAA status back in the late 90’s.)
Point Two: the picture is even grimmer if you look at US government borrowing as a share of revenues. US goverment debt (federal, state and local) was 330 percent of revenues in 2009 — the highest ratio of any AAA country. And that 330 percent doesn’t include additional trillions of dollars in new “contingent liabilities” — bank guarantees, federally insured mortgage-backed securities, and so on.