Just take a look at what’s happening to Greece, Ireland, the United Kingdom and other nations in Europe. They didn’t act soon enough; and now their governments have been forced to impose painful austerity measures: large benefit cuts to seniors and huge tax increases on everybody.
Their day of reckoning has arrived. Ours is around the corner. That is why we must act now.
This was the biggest wallbanger of the evening. Paul Ryan's response to the State of the Union argues that if our debt continues to rise, we will eventually be forced to abandon our social programs. As a result, we should cut them now.
The obvious response (being made by Ed Shultz at the moment) is that there is other spending (such as Defense spending) that could easily be cut.
But that's not why Ryan's an idiot. It's because Greece's economic woes have nothing to do with the Greek economy.
Greece's woes are caused by terrified Germans.
In the wake of the economic collapse which occurred a few years ago, the Greek economy took a massive hit. The standard method which has been used to pay off debts that a government can't afford because of a terrible economy is inflation.
When inflation happens, it actually helps to rejuvenate a struggling economy. The prices of the goods the nation produces drops. As a result, industrial and agricultural jobs become available. Banks are hurt a bit, and student loans and other private loans owed by individuals are devalued. High inflation can stabilize an economy.
There is a difference between a sensible level of inflation in hard times, which does everything I just described, and would have been what happened to the Greek economy, and the hyperinflation caused by the Wiemar republic owing France twice it's GDP in war reparations every year.
That's not what would have happened in Greece if they'd been allowed to inflate their currency. There's just one problem with the typical method that nations use during an economic collapse to pay off their debts.
Greece was using the German administered Euro.
The Euro is essentially controlled by German bankers, who, because of Germany's history, are more frightened by inflation than a Tea Party rally would be of hypothetical Mexican Muslims.
Greece couldn't inflate their currency because they don't have a national currency anymore.
We do.
It's called the dollar. It's kind of a big deal.
We had high (but stable) inflation back in the 70's and 80's without the end of the Dollar as the world reserve currency. As long as we don't sign on to the Euro, and as long as we do what the president called for in the State of the Union, we'll be just fine.