It would be already if there was any other creditor — such as Japan or China — willing to call in their loans to the US government. Yet President Obama continues to spend like a man with no arms. With large new expenditures in the offing, little is being done to rectify the country’s fiscal health. A meltdown has never happened before in American history. Therefore “This time is no different” — to turn the title of a recent book about the payment of debts by Carmen M. Reinhart and Kenneth Rogoff on its head.
What Reinhart and Rogoff were saying in ****This time is different is that those who say the world economy can recover from the 2008-Crash are wrong. It will take a long time. And if the American government is making its debts worse then either recovery will take many years longer or it will precipitate a crash that will be worse than 2008.