Despite official “strong dollar” policies, a case can be made that the US is in the process of defaulting on its obligations via a systematic devaluation of its currency.
As of March 2008, US national debt stood at $9.4 trillion. This equates to over $30,000 per person in the US or a little over $60,000 per head of the US working population. The US national debt has grown by $3 trillion (50%) since 2000, when it was $6 trillion. In 2007 alone, it grew by $500 billion, from $8.7 to $9.2 trillion. In 2005, it was 67% of US GDP, up from 51% in 1988. The Office of Management and Budget projects that total debt will rise to $12.3 trillion in 2013.
Of the $4.7 trillion in private hands, $2.4 trillion (51%) is held by foreign investors. Japan holds around $600 billion (24%) and China holds $500 billion (around 20%). Oil-exporting countries probably hold another 10-14%.
As James Fallow noted in The Atlantic: “every person in the (rich) United States has over the past 10 years or so borrowed about $4,000 from someone in the (poor) People’s Republic of China.”