We are seeing the end game played out over and over in different cultures all over the world. There is one thread of similarity. All of them have practiced Keynesian economics for decades. The belief that more government spending and bigger government to solve society ills has degenerated into a stagnant economy with no growth and in many parts of the world it’s unsafe to walk down the street.
The problem is that eventually the socialist/Keynesian school runs out of other people’s money to spend. They can’t raise taxes high enough, and the market forces them to pay ever higher interest rates to access public markets. When governments increase spending, businesses cut back ..
When governments ramp up their debt loads and ramp up the amount they spend on government programs, there is only one outcome. Eventually the merry go round stops. People get off and look at each other. Some have enjoyed the ride. They either built a business and got rich, or they used crony capitalism to insulate themselves and are well off. The rest of the poor saps are stuck with nothing. They have to survive, so basic human survival instincts take over.
That is the danger of accumulating so much debt. We are starting to see it played out in various economies throughout the world. Unless America changes it’s ways .. we are on the same miserable trail to nowhere.