Not only are we financing a pointless war in Iraq entirely by borrowing, but people are living not paycheck-to-paycheck, but entirely on credit. The following excerpt is from the Time, 13-October-2008 article, The End of Prosperity?
In the case of housholds, debt rose from about 50% of GDP in 1980 to a peak of 100% in 2006. In other words, housholds now owe as much as the entire U.S. economy can produce in a year. Much of the incrase in debt was used to invest in real estate. The result was a bubble; at its peak, average U.S. house prices were rising at 20% a year. Then—as bubbles always do—it burst.
Guess it’s time for people to put away the credit cards and live paycheck-to-paycheck like they did in the Seventies…