Our Debts- A Ticking Time Bomb

America is sitting silently with a debt bomb, a bomb that affects every citizen, job and industry from coast-to-coast. The facts of this are known, the results could be catastrophic - but still our leaders do nothing.

Government debt is almost $9 trillion and costs approximately $1.1 billion per day in interest alone. This cost goes directly to our debt lenders, almost half of whom are foreign nations. Big lending countries like Japan and China channel much of these proceeds into their own domestic economies, as well as state-run Sovereign Wealth Funds (SWF). China’s SWF is currently worth $1.4 trillion, to put it in another way: they can buy almost any U.S. company they want (and most U.S. companies are for sale on the open stock market).

The debts around us continue to grow as we increasingly import more than we export:
Year US Balance of Trade Deficits

2001 $361 billion
2002 $421 billion
2003 $495 billion
2004 $611 billion
2005 $711 billion
2006 $765 billion

The world is fine with the U.S. trudging deeper into debt because they profit from it.

Foreign countries earn billions through ownership of U.S. debt. Much of that wealth is used to acquire American companies. Without domestic ownership American companies’ profits are sent overseas. The U.S. produces less at home, consumes more from abroad, and in doing so, amasses more debt. This increased need for loans and dependence on foreign countries to continue lending to us causes us to lose leverage in negotiations with these countries. As a consequence, we have given some companies in these countries advantages that have caused American owned companies to be uncompetitive and forced to lose money. Some major American industries are now teetering on the edge and could possibly collapse. Witness our auto industry.

This is the debt bomb's vicious circle.

You must ask yourself, do we want to live in a country where the effort of the American workforce resides in the profits of overseas countries and companies who have bought out America?

Our answer at EconomyInCrisis.org is no. We hope yours is too. Write to your congressional representatives and demand that we reduce our deficits. If we do not act soon the debt bomb may destroy the entire economy.