A new report by the New Economics Foundation makes for a disturbing read. It shows that the USA is by far the largest indebted nation in the world and that they are being bankrolled by some of the poorest nations on earth.
Our grossly unjust economic system means that less than 300 people in the USA owe a total of $2.2 trillion – almost equal to that owed by the whole of the developing world. In other words, each US citizen owes the rest of the world $7,333, while each citizen of the developing world owes only $500. This is being made worse as US debt spirals further and further out of control with US imports now being more than twice their exports.
The richest country on earth sucking in the savings of the rest of the world to finance excessive consumption is certainly bad. However research also shows that additional billions of dollars of flight capital is leaving the developing world every year and flooding towards the USA. Indeed if this is taken into account over the past few decades, then Argentina, and at least 25 African countries are net creditors of the West.
In other words instead of bleeding their economies dry through debt service payments, these countries should be sitting back and waiting for the money to roll in. So while the US is free to pursue any macroeconomic policy it chooses, the poor world must succumb to being ‘structurally adjusted’ by the IMF and her rich-world financers.
Philip Booth, Gloucestershire Green party
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