Globalist Quiz: Major budget adjustment
Close-up of a five spot
TEXT OF INTERVIEW
Steve Chiotakis: We thought we'd test our knowledge of international affairs once again as we do every so often. And we're glad to bring in Stephan Richter, with this morning's Marketplace Globalist Quiz. Good morning, Stephan.
Stephen Richter: Good morning, Steve. Are you ready for today's quiz?
Chiotakis: I am ready, let's get it done.
Richter: Which of the following major economies will have to adjust the most in terms of its budget to get back to a sustainable debt level: Italy, Spain, the United Kingdom or United States?
Chiotakis: I'm going to guess the United States.
[Sound of a correct! bell]
Richter: You are so right. The bad news for the United States is that it needs to adjust its budget almost as much as Greece, which is the laughing stock, between now and 2020. About 12 percent need to be cut out of our budget in order to get back to that sustainable level by 2020, which is considered like 60 percent.
Chiotakis: Ah, part of the stimulus obviously, but also the debt going back many, many years in this country, Stephen.
Richter: And the bottom falling out of the economy with no tax revenues at the state and local levels. And I guess the only good news is that other countries have a hard time, too; the new government in the U.K. will need to correct its budget balances by about 9 percent. The Japanese have even a harder job, they need to cut 13 percent. But that shows us that the pain is quite evenly spread around the globe, and wherever this financial crisis came from, we're all going to carry its consequences for quite some time to come.
Chiotakis: And not a whole lot of cheery information. Stephen Richter, thank you for . . .
Richter: I'm sorry about that today, but I'll try to be more sunny next time.
Chiotakis: Well we'll hope so. All right, Stephen Richter joining us this morning. Stephen Richter, thank you so much for being with us.
Richter: Thank you.
Chiotakis: Stephan Richter is a publisher and editor-in-chief of TheGlobalist.com, a daily online magazine of the global economy, politics and culture.