How and Why a U.S. Sovereign Debt Crisis Could Cccur

From AEI:

Monetary Policy/Financial Regulation

How and Why a U.S. Sovereign Debt Crisis Could Cccur

by Peter J. Wallison

American Enterprise Institute

January 27, 2012

A United States sovereign debt crisis is a remote possibility, but in our increasingly fragile system it could be triggered by a number of financial catastrophes—from a chaotic break-up of the Euro system to something as adventitious as a serious earthquake in California. The most likely source of a United States sovereign debt crisis, however, is a failure of the United States political system to address the growth of the major entitlement programs—Social Security, Medicare and Medicaid. That possibility is discussed in this paper.

URL: www.aei.org/files/2012/01/26/-how-and-why-a-us-sovereign-debt-crisis-could-occur_090512648311.pdf