The US simply consumes too much, yet regards any tax hikes with sheer horror Struggle: Barack Obama is battling Congress
You don't have to spend much time in the US, or, more particularly watching American TV, as I did recently on a trip to the IMF, to realise what is wrong with the place.
What you see and hear on the news channels offers grounds for despair. I have to say that I like individual Americans, a terrible generalisation I know, and there is much to admire - many of her companies still lead the world, Hollywood dominates global popular culture, her armed forces protect the rest of us in the free world gratis, and Americans enjoy an enviable quality of life, whatever the stats say. But, America's politics, and especially the management of the economy, is one of the least appealing aspects of the American way, and, as Standard and Poor's and the IMF have warned in recent days, it threatens to undermine that way of life.
It's difficult to know where to start but we might as well take a look at the immediate problem of the federal debt ceiling.
In a way, this ceiling is a good idea, and a laudable attempt at self-discipline, a bit like having a bank manager who you tell not to allow you to increase your overdraft limit under any circumstances, or a heroin addict who issues similar instructions to friends, family and dealer. So it is with the US debt ceiling, currently set at $14,294bn.
The United States has almost reached that stock of national debt, and the fact that technical default might follow a refusal by Congress to nudge it upwards is one hot topic of debt on the US news channels.
The Tea Party are the ones baulking at increasing the debt ceiling, and the best estimate is that the American government will run out of room somewhere between May 16 and July 8, in which case it will be in no better a state to honour its obligations than Greece, Ireland or Portugal.
OK, the Tea Party Republicans are being unduly stubborn, but you can see their point. The ratchet on the US debt is in one direction only, and a firm unbreakable ceiling might conceivably force policy- makers to trim spending immediately.
Surely, you might wonder, the administration can find some corner of the empire of spending that they could trim and keep within what is after all a pretty generous overdraft.
It would be nice if the White House gave some sort of nod to that, but they will not. Hence the stalemate. When push comes to shove no one expects the US to default on rolling over its debt - this is not Greece.
Yet the failure by Congress and administration respectively to show flexibility and that sprit of cross-party co-operation that was once so hopefully invoked by President Obama is already raising the cost of servicing America's debt.
America's fundamental problem is that it consumes too much, and ordinary Americans regard any tax hikes with horror, arguing that they are depressed enough as things stand and is the last thing America's faltering recovery needs. Welcome to the real world, America. It is the price you pay for consuming far too much on borrowed money. Surely the administration could find some corner of the empire of spending that they could trim