America as a Third-World Nation?

Some interesting observations from Judy Bachrach at World Affairs:

there are, it seems, certain hardcore definitions of what it means to be a first-, second-, or third-world country. These are readily available on a helpful website, which quotes the Encyclopedia of World Geography. . . .

A third-world nation, it turns out, is “generally categorized as poor with unstable governments.” A key factor, we are told, is “the lack of a middle class—with impoverished millions in a vast lower economic class, and a very small elite upper class controlling the country’s wealth.”

Also: “Most third-world nations have a very large foreign debt.”

Now, let’s examine all this. Last year, the United States had over $14 trillion in debt—$4.4 trillion of it held by foreign governments, which certainly sounds “very large” to me. China, once considered a second-world country, currently owns about $892 billion of American debt; and Hong Kong, which is basically part of China these days, has about $138 billion in US securities. Iran, on the other hand, has only around $13.5 billion in external debt; and Ecuador almost as much. So who among these countries would we qualify as third-world?

What about poverty, another big indicator of third world–dom? Two years ago, 43.6 million Americans were categorized as poor, up from 39.8 percent a year earlier. Even worse: About 19 million Americans now live in extreme poverty. Meanwhile, according to the Los Angeles Times, the number of millionaire US households has climbed 15 percent in one year—to 4.7 million. (Quote from Larry Mishel, president of the Economic Policy Institute in Washington, DC: “The recession is going to end up accentuating the inequalities of income and wealth…”). What he means is: the middle class is becoming ever-smaller. What he also means is that a tiny elite seems to be controlling much of US wealth.

And now let’s get to that last indicator of third world status: by which I mean unstable government. Let’s imagine a country where the House Speaker walks out on debt ceiling negotiations. Where the president openly complains that this same legislator refuses to return his calls. Where nothing is safe any longer, and no one knows when or if a job/corporation/bank/state government is going to dissolve. Or a once all-powerful nation is about to default.

Now that’s what I call third-world.