The cover of Newsweek (1/31/12) has the following title of an article on the lower part of its cover. The title reads: “Will Christine Lagarde stop the next global meltdown?” The article explains how an economic crisis can easily erupt as a result of the economic problems in Europe and the United States.
Wait a minute. As this article pointed out, we were saved from a potential great depression only a few years ago. President Obama and the Democrats passed the stimulus bill that saved the day. But now it is only 3 years later, and the problem is just as bad, if not worse? Apparently, the issue has yet to be resolved.
Greece is experiencing riots and unrest because of the cutbacks necessary to stabilize the spending. A number of other countries in Europe are not far behind Greece. The United States is not very far behind them. We are already experiencing unrest at the very threat of cutbacks and these are just a threat and not nearly as severe as what Greece must do. And we are not heading that way?
How often do you suppose global crisis occurs? The size of the problem alone would lead me to believe that it would be a long time between each occurrence. If you look at the history of the 20th century, you can find several. Spread out over 100 years. Now we have two in less than 5 years. This is just the same crisis. That cliff that we were saved from is still right in front of us. And our financial position must be weaker as the ‘solution’ was to spend more money that we had to borrow and has made the debt that much larger and more difficult to pay off. In fact, the interest on the debt is fast becoming a problem. This is where Greece has run into trouble. The global meltdown is still a potential threat, and Christine Lagarde does not have the power to halt the massive spending that is the base cause.