a curious Yankee in Europe's court

blog about living in Europe, and Italy

More about the Greeks (and some others)

Posted on the September 28th, 2010

In an earlier post today about a Vanity Fair article about Greece and its ongoing financial morass, I highlighted a question posed by the writer of the piece, Michael Lewis:

Even if it is technically possible for these people [Greeks]to repay their debts, live within their means, and return to good standing inside the European Union, do they have the inner resources to do it?

The last phrase of this question — do they have the inner resources to do it? — won’t stop echoing through my mind. Could it be my (blogger) conscience nudging me to recall something else Lewis said in the Q&A interview with him that accompanies his article? He was answering a question about a rather sizeable ongoing financial mess of another country, the United States.

Specifically, Lewis was asked if he could foresee a scenario in which the US Treasury goes bankrupt.

Excerpt of his reply (that begins with “Yes”):

…It’s not that hard to see us getting to a moment where we are essentially restructuring our debt. I think it is a long way off, but how can it not happen? We are so indulged by our creditors. Even though we have grotesquely mismanaged our financial affairs, people are willing to lend us money on terms that they would not lend on to anybody else in the world. It’s unbelievable to me that the U.S. Treasury can borrow 10-year money at around 2.5 percent.

The Chinese are willing to lend back to us all their surpluses basically for free, and we keep running these deficits. The benefits are just too great to our society for us to turn away…

So that question about having the inner resources to clean up your act is also being posed by Lewis here, more obliquely, about the US and its citizenry.

(Blogger) conscience clean now.

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