It's The Debt
by Martin Armstrong
Former Chairman, Princeton Economics International, Ltd.
You can cut every penny of spending. You can fire every government employee and you can default on all their pensions. But unless you default on the national debt, you will never stop the interest expenditures from rising to the point they crowd out all other spending.

So what is the net effect?

The interest expenditures are being exported so they do not stimulate the economy at all. We debate the loss of manufacturing jobs, but nobody talks about the exportation of interest expenditures that is far worse than the loss of manufacture. So while politicians take pictures of themselves working out, if they loved their country and family posterity, just perhaps for once they should address the long-term economy instead of worrying about how pretty they look. Unfortunately, history dictates that is wishful thinking. Politicians are elected and thus they will not act in anticipation of a crisis, only when the crisis takes place. Representative government fails every time because the self-interest of the political class is in direct opposition to the self-interest of the people and the nation.

http://www.martinarmstrong.org/files/June13th%2014th%20Turning%20Point%202011.45%2006-14-2011.pdf