Consider and research, if you can, then evaluate
(a) The use of money raised by debt
(b) The alternative displaces
Debt induces inflationary tendencies which triggers a price spiral which in turn cause cost-push inflationary pressures.
Our foreign debt has shot up to Stratoshpere - $59.5 billion
and our internal debt $60billion
So are we solvent?
Many variables brought us to the precipice. We now stare into a black hole. With America sinking from recession into a mild depression, and the World battling the concept of new Financial Architecture , we are in for some many complex times. To say the least
In Contingency planning or even a worst case scenario planning we should come to grips with a 4 headed dragon!
1. NARROW TAX BASE
2. INEFFICIENCY IN TAX administration
3. Imbalance towards indirect TAXES
4. Low elasticity of TAX system.