Experiencing the World Economic Quagmire: Is the Quicksand devouring us?

By

Spyros Pavlou, PhD

I recently saw an interesting graphic published by the NY Times. It was entitled “Europe’s Web of Debt” Well, I call it “The Vicious Pentagon”. It depicts graphically the moneys owed between five European countries with shaky economies. Each country is shown as the apex of a pentagon. The US was not included in the graphic, but if it did, I would call it the “Vicious Hexagon”. 

To put this analysis into perspective, I included the US as part of the debt-per-capita comparisons. The table below summarizes the total Debt-Per-Capita for each of the five European countries including the US as a point of reference.   

Country         ªDebt-per-Capita ($)           *Population (Millions)    ¹Tot Debt (Billions)

                                                                         

Ireland                  206,429                                 4.2 º (0.0137)                                    867

USA                      38,737                               307.2 (1)                                         11,900

Spain                      27,160                              40.5 (0.132)                                      1,100

Portugal                 26,729                              10.7 (0.035)                                         286

Italy                         24,096                               58.1 (0.189)                                      1,400

Greece                   22,056                              10.7 (0.035)                                         236

*Population figures are as reported in the CIA World Fact Book

¹Total Debt is from the NY Times figures

ª Debt-Per-Capita is computed as the Total Debt divided by the Country’s Population

º Values in parentheses are the fraction of the country’s population as compared to the US

It’s surprising to see that the US ranks behind Ireland, and Greece appears to be the most fiscally responsible among the countries examined here. Economic induced riots and public unrest are occurring in all countries irrespective of their size.

This simple mathematical exercise confirms that the world is financially interconnected, and it really doesn’t matter which country one lives in. So, we all appear to be in dire straits economically. Obviously, debt is a universal disease that should be exterminated immediately if we are to survive as a world entity.