This one's for you, Dr. Evil

A tremendous debate is taking place south of the border right now because the USA is approaching its "debt ceiling."  In other words, the US government can't owe more than $14.294 trillion dollars. For a handy reference on what a trillion is, click here.   Currently, the government owes $14.243 trillion dollars.  When did that happen?

Well, it started at the end of Eisenhower, grew during Nixon and the Vietnam Wars, and has been growing like a bad weed ever since.

However, this is where is gets really interesting: because of the old-school series of checks and balances in US democracy, politicians have to vote to raise the debt ceiling.  If they don't, the USA will be in default - the world's largest economy will be unable to pay the bills that are due.  Which means that conceivably, creditors like the Chinese government, the Saudis or the Japanese could come knocking.

So where has Uncle Sam been spending other people's money? Have a look!

Mostly on wars, preparing for wars, and intimidating other countries not to start wars.  Somebody tell Edwin Starr that war is good for something  - escalating a nation's debt beyond its capacity to produce wealth.

The craziest part of all this is that the Republicans are saying the only way they will vote in favour of raising the debt ceiling - remember, this money pays for veterans, what little Medicare they have, and for Social Security - is if Obama agrees to massive spending cuts. 

The crazy part is, nobody is talking about the giant Kevlar elephant in the room.  Nobody is talking about cuts to military spending, or closing bases in foreign countries (they have dozens). They are talking about cutting Medicare.  Without getting too apocalyptic, I can't even imagine what a US default would do to the Canadian economy.  I can't imagine what would happen if the US government runs out of money, especially when that same government has been printing money in an attempt to maintain the dominance of the US dollar abroad and spend its way out of a recession.

Something tells me that if those chickens ever come home to roost, we're going to see the ugly shadow of globalization, all over the world.  Instead of the 'rising tide' the big spenders keep promising us, it's going to be a debt tsunami that wipes away most of the material progress of the post-industrial age.

Makes 100 million dollars seem quaint, doesn't it?