I.O.U.S.A.: "
'Wake up, America! We're on the brink of a financial meltdown. I.O.U.S.A. boldly examines the rapidly growing national debt and its consequences for the United States and its citizens. Burdened with an ever-expanding government and military, increased international competition, overextended entitlement programs, and debts to foreign countries that are becoming impossible to honor, America must mend its spendthrift ways or face an economic disaster of epic proportions.' http://www.iousathemovie.com
Got inspired by I.O.U.S.A. the movie, I did some research about America and my recourses primarily came from cia.gov, wikipedia.org and the movie itself. I'm not really an expert on economics and politics, but here's what I found.
America's population, at 303,824,640, is the third largest in the world, leading by China with 1.3 billion people and India (1.1bil). The total GDP of America as of 2007 is $13.5 trillion, making it the first on the list and closely followed by China ($7.1trillion). When considering GDP per capita, American have $45,800, which is 10th on the list In 2007, the federal (public) debt of America is at 64% of the GDP, around $8.7 trillion. If that debt is going to be divided equally to every America, each and every one of them will have to pay $28,635. In the end, every American will only have $17,165 ($45,800 - $28,635) as their true GDP per capita, lower than Puerto Rico ($18,400).
When we look back into history, there was only one time when America was free from debt, which was in 1835. It didn't stay that way for long because during the Civil War (1861-1865) the debt spiked up to 27% of GDP, more that $1 billion, after total war spending of $5.2 bill. In 1931, Federal Reserve was founded to help manage the federal money supply and in that year also, the modern income tax was introduced. When the Great Depression Era begun, the debt was at 44% of GDP and extreme economic hardship haunted every American citizens. By the early 1940s, when the World War II started, federal debt skyrocketed to more than $200 billion or 122% of GDP. During Ronald Reagan era (1981-89), federal debt continued to rise, from 33% ($909bil) in 1980 to 64% ($4 trillion) in 1992 due to large tax cut that was implemented to flight against inflation. Thanks to Clinton with his Balanced Budget that was introduced in 1996, America once again rise up from the economic recessions, lowering the federal debt to 57% and with $559 billion trade surplus by the end of his era.
Now let's talk about budget, surplus and deficit. In 2007, US federal government expended $2.73 trillion but with only $2.57 trillion of revenues. A total deficits of $160 billion. However, this number increases in 2008, with more than $400 billion of budget deficits. For the last 40 years, America have had 35 budget deficits with only 5 budget surpluses, during Clinton era. And that only with the help from Social Security money, without it America will suffer more than $610 billion of deficits in 2008. In less than 10 years, Social Security will be paying out more than it takes in and the deficits will become larger and larger, while Medicare support will make the situation worse. According to CIA, America's account balance (trade surplus) as of 2007 is -$731.1 billion and that’s is dead last on the list, 224th to be exact. And who's on top? Well you may already guess, China, with an enormous balance of $317 billion, followed by Germany ($254b). I'm quite surprise where Malaysia stands, at 16th! with balance of $29 billion. You might ask 'Where the hell America get the money from after all the debt?' Well the answer is quite obvious, China and Japan of cause. As of 2007, more than $1.1 trillion was loaned to America
Bush Era (2000-2008) contributes a lot, to the America's debt. In 2000, when Bush won the election and become the 43rd president, the federal debt was $5.6 trillion. With hundreds of billion dollars were spent on war in Afghanistan and Iraq, 12 tax cuts in four year, and declining dollar against other currencies, federal debt increasing substantially to $7.4 trillion in 2004. Four years later, the debt grows like no tomorrows to $8.7 trillion.
By the year of 2040, the federal debt is estimated more than 244% of GDP. Tax have to be increase from 20.4% now to 42% then. Will America succeed? They have to, but the question is 'Will they?'. As the America's Founding Fathers said, 'It's really up to us. We, the people'
I.O.U.S.A: One Nation. Under Stress. In Debt.
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