The United States Is Not Greece

by Stuart Shapiro

I’ve blogged several times on the debt crisis in Greece.  I want to be clear that I do so because a European economic collapse would have a significant impact here, not because we are anything like Greece.  Senate Minority Leader Mitch McConnell seems not to understand this distinction, repeatedly comparing our economic situation to Greece.  Steve Benen describes the ignorance that this shows.

In every meaningful way, the comparison is just silly. The U.S. has extremely low interest rates and foreign investors are happy to loan us money; Greece has extremely high interest rates and no one is eager to loan the country money. The U.S. has its own currency; Greece has the euro. We have a manageable debt; Greece has a debt crisis. We’re a large country with an enormous economy; Greece is a small country with a small economy. We have one of the world’s most stable systems of government (at least for now); Greece’s government structure is suspect.

For a leading senator to tell a national television audience that the United States looks “a lot like Greece” is a clear reminder: McConnell is not to be taken seriously on these issues.

I think Mitch McConnell would like to see us become like Greece because he keeps endorsing tax cuts and has historically favored the huge spending increases of the Bush years.  So maybe he’s just engaging in wishful thinking when he makes the comparison.

By: Stuart Shapiro

Stuart is a professor and the Director of the Public Policy
program at the Bloustein School of Planning and Public Policy at Rutgers
University. He teaches economics and cost-benefit analysis and studies
regulation in the United States at both the federal and state levels.
Prior to coming to Rutgers, Stuart worked for five years at the Office
of Management and Budget in Washington under Presidents Clinton and
George W. Bush.