By Angel Lizardi |Staff Writer|
The United States avoids joining Nazi Germany as the only major economic power to default on their loans, when Congress agreed to a new debt ceiling.
According to Bloomberg, “Germany unilaterally ceased payments on long-term borrowings on May 6, 1933, three months after Adolf Hitler was installed as Chancellor. The default helped cement Hitler’s power base following years of political instability as the Weimar Republic struggled with its crushing debts.”
Dr. Timothy Pytell teaches History at CSUSB, his research includes Genocide, Holocaust, and the European Union said that Hitler’s economic policy was bad for Germany because it was Hitlers policy.
“Hitler was free to do what he wanted in terms of economic policy. He could print money if needed, designate labor/workers where needed, invest in infrastructure (the autobahn being one of the most famous). In short he could implement new deal type of proposals by fiat”, said Pytell.
Pytell also mentioned that it is important to note Hitler was able to spend lavishly because he was plundering Europe of its resources and also mentioned that public support was high on spending until World War II.
The United States has a national deficit of $17 trillion, which is about 80 percent more than what our GDP is.
This means that if you add up all the goods and services that the United States makes in this country for an entire fiscal year, our debt is 8 tenths of a percent.
Although it may seem like a pretty steep number, GDP quarterly reports say that the economy is doing better.
“Our GDP (gross domestic product) is up about 2 percent, and ideally we would like that number to be up to 4 percent,“ said CSUSB Economic Professor Dr. Thomas Pierce.
Compared to other countries like Japan, who is the owner of the largest debt in the world at 960 trillion yen, or $12 trillion.
According to The Telegraph, Japan’s debt is 1.4 tenths of a percent greater than their GDP, far above the United States.
Japan’s debt is attributed to public works, Social Security, government taxes, interest payments, other expenditures
Back in 1990, Japan’s main economic concerns were the public, social security, government taxes, and interest payment from debts.
As stocks soared so did their spending habits, accruing more debt and interest.
Once the stock market crashed, Japan borrowed more to pay social security to support an increasing elderly population.
Public works declined and more social security payments were given out and when the earthquake in 2011 happened they decided that it was time that they attempt to spend responsibly said The Telegraph.
Greece owns the highest debt-to-GDP ratio 1.57 times bigger than their GDP which is $256 billion.
According to BBC, Greece had spending troubles before it adopted the Euro which is the main currency in Europe.
“Public sector wages, for example, rose 50 percent between 1999 and 2007 – far faster than in most other eurozone countries. The government also ran up big debts paying for the 2004 Athens Olympics,” BBC reported.
Currently, Greece has been reporting that they are expecting a four percent growth while decreasing unemployment rates.
While the U.S. economy is not where it should be, countries like Japan, and Greece are in far dire straits.