Buckling under the weight of massive debt created by uncontrolled government spending, the nation of Greece is on the edge of a financial abyss that threatens worldwide consequences.
The failure of a first bailout of Greece by other European nations has led those countries to offer a second bailout. But this one comes with requirements for big new austerity measures -- on top of the first bailout's huge tax hikes, spending cuts and reductions in pay and pensions.
Outraged that their government can no longer spend money it doesn't have, Greeks have taken to the streets. Demonstrations against the austerity plan from the original bailout have degenerated into rioting and violence.
Now, the chaos may deepen as the Greeks prepare to vote in a referendum on whether to accept the second bailout and all its painful requirements. If the referendum fails, Greece likely faces outright default on its loans and withdrawal from the eurozone -- the group of 17 nations that have the euro as their common currency.
Financial markets around the world -- including in the United States -- plunged on the news that Greece would hold a referendum on whether to accept the latest bailout. (There are indications that it may vote no.)
The fear is that Greece's financial collapse could trigger a new global recession -- in a world where many nations are already in an economic crisis. That has prompted calls for Greece's government simply to accept the bailout without holding a public referendum at all.
Meanwhile, on this side of the Atlantic, we're not quite so far along the path to disaster as Greece is. Yet Congress is playing games on the issue of reducing our own potentially catastrophic $14.9 trillion debt. Proposed spending cuts are too small, and they are coupled with dangerous tax hike proposals and plans for even more wasteful government spending.
Must we follow Greece's example and be brought to the point of ruin before we will reverse course?