>> this has not proven to be a problem in all of human history and therefore not a problem now<<
Oh, now, can't you tell when I am trailing the bait (I know you lurk), hoping you'll take a nice bite? You've triggered another lecture on the history of the Great Depression of the 1930's.
Germany and Austria's public debts were so high that it frightened von Mises, so that he turned down the offer of a prominent position at the main Austrian bank, the Kreditanstalt, which collapsed shortly afterwards, due to the discovery that it was insolvent. It was the collapse of the Kreditanstalt that triggered a collapse of banks all over Europe, especially Germany. Germany experienced the worst of the Great Depression, as I've mentioned before, as absolutely nobody anywhere would give anyone in Germany credit, due to the massive defaults, and the result of all this was Hitler, World War II, and eventually the World Bank and the IMF.
Very similar sorts of events (massive debt, inability to pay and default leading to depression) occured after the Civil War, when various US governmental bodies went on massive spending sprees, building railroads and canals, causing a depression in England and the US.
Those are just off the top of my head. There were others, but those will do to refute the claim that it's never mattered. It always matters. Getting in over your head is a classic mistake made by the naive and optimistic during good times.
The ratio of public debt to GDP is one of those things that do-good organizations like the World Bank and the IMF take looks at. Public debt to GDP ratio is a sign of public health. Luxembourg's is 5.5%, Australia's is 16.9%, New Zealand's, 44.6%, US is 52.5%, Japan's is 132%.
government.is
If, indeed, China's is 140%, that has to be one of the highest in the world, if not the highest.
Sorry you can't find the post about the happy investors coming into China, and the sad ones leaving China, it was very funny, but rather cynical, and very brutally honest, so maybe it's better left unfound.;^) |
