As a basic tenet, it is the case that the bigger a business, the bigger its running costs. Analogously, it would not be surprising to note that the U.S. does indeed run up the highest annual GDP of all nations in the G20 – of all nations in the world as a matter of fact (currently at an annual $13.5 billion as of 2008). However, this simple and obvious fact is not what I initially planned on boring you, my reader, with.
By simply subtracting a nation's external debt from its GDP, we can derive a value also known as 'Effective Net Worth.' What this excruciatingly simple figure tells us is (as one could imagine) an individual's, firm's, or nation's total assets minus total external liabilities. And compiling information from the CIA World Factbook leaves us with the following information:
As shown above, the U.S. is far from being the most over-consumptive nation. Clearly, the U.K. leads the way for over-consumption with an external debt 5X the amount of their annual earnings. Our right-most column displays net worth per capita (the amount each citizen in the nation in question is worth). As can be seen, Australia, France, Germany, the U.K., and the European Union each consume more than they earn. On a brighter note, the U.S. is in the positive with an average individual worth just over $6K every year.
For the most part, nations with negative net worth per capita can be accused of trying to obtain (with money they don't currently own) social welfare of some sort. In each of these cases, either productivity on the average level is too low, social program costs are too high, or both.
However, a socialist may be relieved to find Canada's net worth per capita soaring in 3rd place (right under South Korea and Japan). Therefore socialism, it appears, may be conceivable while simultaneously retaining one's financial dignity – this is at least what has been suggested by our figures above.
Your statistic is not sufficient for your conclusion. Whether Americans spend beyond their means depends not (entirely) on how much we are indebted to other nations. The amount of borrowing within a country usually increases GDP (a part of your statistic) but does not necessarily guarantee a person is a worthy creditor. Our banks have been loaning to unworthy borrowers which is a sign of spending beyond means. That is indeed why we have the current financial issues today: loaning to people without enough money or stature to repay.
ReplyDeleteYour objection is equivocating Americans to refer to citizens, whereas my post addresses governments exclusively. This is made clear a number of times, one in particular when I refer to external debt of our government. Nowhere did I ever make a reference to internal debt, which is what you're referring to. Had you read closer and more critically, this would have been clear.
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