By Vestnik Kavkaza
In the context of the prolongation of American sanctions against Russia, which restrict the activities of major Russian banks (VEB and VTB) and companies (Gazprom and Rosneft), experts are beginning to speak about a crisis in the American economy itself. There are dire forecasts that the USA “manipulates governments of certain countries and makes them provide policies which lead to conflicts, chaos and civil wars, as the dollar may fall, and nobody will pay for the huge national debt.”
Academician and director of the Institute of USA and Canadian Studies, Sergei Rogov, disagrees with such views: “The Obama administration managed to overcome, although not immediately, the effects of the economic crisis of 2008-2009. And now the US economy is showing very good figures. The strengthening of the dollar against the ruble, the euro and other currencies is an indication of this. The fact that the USA appeared on the verge of energetic self-sufficiency, also played its role. And apparently the US share, which they hold today, will remain for the foreseeable future, the next 10-20 years.”
The American economy is one of the most diversified national economies in the world. It has been in the lead in the world economy for 100 years.
Rogov predicts that China may overtake the US in terms of GDP, not only on the rate of purchasing, but also at the exchange rate as well. But by the middle of this century again the States will have come in first place. This is due to several factors. One of them is that the demographics of the US are much better than in China. “China is now paying the price and will pay a very heavy price for the policy of one child one family. This generation of one child turns into pensioners, and the pension system in China is not developed in a proper way.” India won’t become a significant rival to the USA either, even though it now shows a higher rate of development than ever before. Rogov says that we should not forget that the States today is still the leader in the field of technological innovation. “Though China produces, China does not invent. They spend a lot of money on science, much more, seven times more than we do, but so far they have not yet learned how to invent. For the moment, they still replicate,” the academician says.
Speaking about the national debt, according to Rogov, “the US GDP is almost $18 trillion, the US national debt is about the same - about 100% of GDP. Japan's public debt is 240% of GDP. The public debt of Italy, Spain and Greece is 120-140% of GDP. The public debt of prosperous Germany is almost 90%. After the default of 1998, we had a national debt of 150%. Now Obama has cut the state budget deficit to about 3% of GDP. This is an average figure for the past 60 years. Incidentally, our Ministry of Finances promises more than 3% of GDP deficit this year. That means, at the moment there is no serious threat to the American national debt or to the USA.”
However, Rogov points out that the issue is used in politics largely: “This is due to the fact that Americans do not particularly like paying taxes, nobody likes paying, but especially Americans. Therefore, in America, the share of taxes in GDP is very low, only 15% of GDP. There are also excises and duties. In Europe it is 40-45% of GDP. We have a little less. In principle, all these American debt problems can be solved at once, if enough politicians agree to raise taxes slightly, by 5%. But this will not happen, because the entire American political life is built on this.”
