Whether you can tell it or not, the debt crisis throughout the Western world is as bad as ever.
You might not believe it – but you can hardly be blamed. Human beings suffer chronically from a condition known as ‘normalcy bias.’
Put simply, it means that we become accustomed to all different types of conditions pretty quickly – so that even a situation that should be taken seriously (like a Pan-Euro-American debt crisis, for instance) can soon seem like normalcy.
But pretend for a second that you’re reading about this debt crisis for the first time – and take a look at the following headlines from serious, mainstream media outlets.
The Financial Times, July 31, 2012
“As austerity measures deepen in Spain, there are fears they are ripping apart the country's social fabric”
We’re seeing increasingly larger riots and protests throughout Spain – and Europe – as the Spanish state struggles to continue the endless pipeline of money for nothing.
We’re not talking about some backwater African or Asian country. We’re talking about the 12th-largest economy in the world. If Spain’s “social fabric” can be torn, it should be a sign that our society may be in trouble as well.
The Wall Street Journal, July 31, 2012
“Greece Pushes for Extension on Bailout”
Oh – did you think Greece was out of the news? No. Greece, yet again, needs more bailouts.
I don’t know why anyone would be surprised though. The new normal world we live in is a world where Greece needs to get bailed out every couple months. Why? Because nothing has changed. Greece is still running a deficit, they’re still a part of an untenable currency union, and they’re still broke.
Can these bailouts go on forever? Of course not. What will put an abrupt end to these bailouts is another crisis that will dwarf this current crisis. Then, the bailouts will stop, and Greeks (and other Europeans) will learn true austerity.
The Washington Post, July 31, 2012
“The deep federal spending cuts scheduled to take effect at the start of next year may trigger dismissal notices for tens of thousands of employees of government contractors”
If the other two headlines didn’t get your attention, I hope this third one does.
We are, at most, 18 months behind Europe when it comes to this crisis. And it looks like some of our own “austerity” measures will be on the doorstep sooner rather than later.
What will happen in this country when tens of thousands of Americans lose their jobs overnight?
I don’t know – but my point isn’t to scare you. My point is that it IS a big deal when Spain’s social fabric is in danger, and when Greece can’t survive without endless rounds of bailouts.
It’s not normal, and it’s not sustainable.
The world can bail out Spain and Greece. Maybe Italy. But what about the United States? Who will bail out the world’s largest economy?
Who will be the safety net when the world’s safety net tears?