Debt and America’s Decline
America’s Great Power status has always been tied to its level of public debt, which has now reached roughly 140% of GDP. The problem for the world economy is that there is no newly emerging Great Power that can assume responsibility for global finance, as the US did in 1914.
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MILAN – Italians and other Europeans have serious problems addressing their own national debts, public and private, so it may seem immodest for a European to discuss America’s growing and grave debt problem. But the fiscal realities on both sides of the Atlantic nowadays are very similar, and only lingering trust in the promise of America keeps alive the expectation among some Europeans that some grand American coup de théâtrewill resolve the country’s dire debt situation.