PIIGS ‘R’ Us? The Coming U.S. Debt Crisis and What Can Be Done About It

University of Calgary – School of Public Policy Communiqué, Vol. 3, Issue 2, July 2011

8 Pages Posted: 25 Jul 2011 Last revised: 7 Sep 2011

See all articles by Stephen Richardson

Stephen Richardson

University of Calgary - School of Public Policy

Date Written: July 25, 2011

Abstract

The U.S. is beset by weak economic growth, ballooning debt and stubbornly high unemployment but the collapse of the housing bubble that spurred the 2008-2009 global financial crisis was more a consequence than a cause of what is wrong. The real culprit was and remains poor policymaking in the areas of taxation, finance and economics, which helped bring on the crisis by encouraging Americans to engage in counterproductive behaviour. This paper warns that without meaningful fiscal reform, the U.S. risks joining the PIIGS – Portugal, Ireland, Italy, Greece and Spain – on the road to ruin through unsustainable debt, high spending and chronically low growth. The author acknowledges the heated partisan debate over whether the answer is higher taxes or lower spending and explains that neither course alone offers a practical way out. A balanced approach incorporating aspects of both, combined with detailed policy reform as set forth in this paper, is the best solution. U.S. politicians must put aside their differences and replace bad policies with sound ones or the American economy will face disaster.

Keywords: U.S., debt, tax, policy, reform

JEL Classification: H21, H24, H25, H55, H62, H63

Suggested Citation

Richardson, Stephen, PIIGS ‘R’ Us? The Coming U.S. Debt Crisis and What Can Be Done About It (July 25, 2011). University of Calgary – School of Public Policy Communiqué, Vol. 3, Issue 2, July 2011, Available at SSRN: https://ssrn.com/abstract=1894927

Stephen Richardson (Contact Author)

University of Calgary - School of Public Policy

Calgary, Alberta
Canada

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
347
Abstract Views
1,473
rank
95,674
PlumX Metrics