U.S. national debt clock (Photo : Reuters)
While Greece's skyrocketing debt has sparked a worldwide financial crisis and put the country's future up in the air, several economists have noted that the United States is just a few years from hitting the same dangerous debt levels. The U.S. economy is about 24 years from reaching Greece's current level of debt, in terms of its Gross Domestic Product (GDP).
In 25 years the southern European country's debt has surged from 75 percent to over 175 percent of its economy. Meanwhile, economists project that U.S. debt will reach 180 percent of the GDP by 2039.
Romina Boccia, a Heritage Foundation budget expert, told the Daily Caller that in about one-fourth of a century the U.S. will reach the same debt level as Greece's current figures, and is speeding towards the debt amount where major economic problems become more likely. It is the "danger zone."
Boccia noted that American debt is a bit different because the U.S. can print money to pay off its loans, while Greece uses the Euro currency, according to the Daily Caller. However, the U.S.'s rising inflation is a problem.
She noted that when a nation's debt levels hit 85 percent, it become a major issue because there is a strong link to lower economic growth. It could become the next Greece.
The economic expert also noted that debt is like an anchor that pulls down the economy, and within time creditors will stop lending funds to the U.S. In fact, the country is already in a "precarious situation."
Some financial gurus have even argued that the average American household is worse off than Greece. For example, Americans have a higher debt-to-income ratio. The average U.S. household owes about $205,000, with a household income of about $55,200; that is a ratio of 370 percent.
In addition, American households' debt cannot get a clean slate unlike Greece's, according to Fortune. If Greece is bailed out, it can default on its debts to foreign lenders, including the International Monetary Fund (IMF). However, personal debts usually stay unforgiven.
The American consumer lifestyle is inviting and thrilling. However, if not kept in check it can have awful consequences.
