Reply #5: Krugman is right, but the problem is more long term and not immediate. [View All]

[Meldread]

The US and the UK are not Greece. Yet.

The problem rests in the future, when we reach a point when it becomes clear that we won't be able to repay the debt. When our debt becomes unsustainable, that is when we become Greece.

I don't think attempting to balance the countries checkbook should be considered a dirty or bad thing. In fact it can lead to some good things: No more foreign military adventurism, a cut back on military spending, sane and much needed reform to the welfare system, and if not an increase in taxes at the very least an immediate freeze on all tax cuts.

We should not be adverse to trying to solve the problem now. Certainly, since we're in the middle of a recession spending is needed - though I disagree in a large way in how the Stimulus was created (it needed to be more targeted and focused) - I also believed that it wasn't big enough. I think we could have hit so many birds with one stone. If the stimulus was focused on providing something like super low interest loans at a fixed rate, focused 100% on small business creation, and nearly 100% on renewable energy development, research, deployment, training, etc. Doubled the size of the package... well we all know the benefits of that.

Anyway, we want to put ourselves on a path to solve the problem rather than ignore it. We obviously have to pay off our debt. If we refuse to do this, then someday we will end up like Greece, and we will find ourselves in a serious crisis - and in that situation, we will have an austerity plan imposed upon us. It's much better to make the necessary choices of our own free will, now rather than later in the midst of a crisis. I don't think that'll happen though.