Going into 2008, the United States finds itself in the position of being unable to pay for its own elevated living standards or its wasteful, overly large military establishment. The government no longer even attempts to reduce the ruinous expense of maintaining huge standing armies.
Instead, the Bush administration has put off these costs for future generations to pay or repudiate. This fiscal irresponsibility has been disguised through manipulative financial schemes, but the time of reckoning is fast approaching.
There are three aspects to the U.S. debt crisis.
First, the U.S. is spending insane amounts of money on "defense" projects that bear no relation to the national security of the U.S. At the same time, the income tax burdens on the richest segment of the population are at strikingly low levels.
Second, there is a mistaken belief that public policies focused on frequent wars, huge expenditures on weapons and munitions, and large standing armies can indefinitely sustain a wealthy capitalist economy. The opposite is actually true.
Third, this devotion to militarism despite limited resources results in a failure to invest in social infrastructure and other requirements for the long-term health of the U.S. These are what economists call opportunity costs, things not done because the money was spent on something else. The public education system has deteriorated alarmingly and health care is not available to all citizens. Most important, the U.S. has lost its competitiveness as a manufacturer for civilian needs, an infinitely more efficient use of scarce resources than arms manufacturing.
In the video above, Ron Paul discusses some of the dangers of current U.S. foreign policies.