I was happy to read last week that the G-8 Ministers have a plan to help relieve Africa of about $18 billion of debt. The U.S. and the U.K. are seeking support from Japan, France, and Germany for their strategy to assist 27 developing nations in Africa.
The strategy calls for advancements in aiding these regions, removing trade barriers, and writing off debts, and, as Michael discussed above, part of the plan is to have the International Monetary Fund sell off gold reserves to help support the cause.
While Michael focused on the value of gold for today’s investors, I’d like to take a moment to show you what I see between the lines of the G-8 plan.
What I see is Tony Blair and George W. Bush understanding the ramifications of heavy foreign debt to a growing economy. They also clearly understand that something has to be done to get Africa out from under a blanket of debt in order for it to grow.
As George told us today in his commentary above, the U.S. currently carries public debt of $7.79 trillion! And this debt is growing by the day.
What I’m wondering is why can’t the U.S. government connect the dots between its relief efforts for other areas and its issues here at home to see that its current debt situation is a recipe for disaster? Why isn’t more being done to reduce our debt or at least slow down its steady climb?
Now, don’t get me wrong. I believe foreign aid to emerging nations is extremely important to our global economy. I’m a firm believer in “give and ye shall receive.” I’m not saying we shouldn’t be providing such aid–I’m saying we should be spending an equal effort on admitting our own weaknesses and solving the issues of today that will affect the growth of our economy in the future.
Twenty or 30 years down the road, when our economy and our population are really suffering under a heavy burden of public debt, who’s going to step up and bail us out of trouble? I don’t think any nation would want to get involved in the near-impossible task of providing relief for and digging out a country that put itself into a $7.79 trillion hole.