What happens when the government runs out of money, and becomes bankrupt?

Question

The U.S. Federal Government is in major extreme almost unsolvable debt, State governments sometimes go broke resulting in a shut down of services. So what happens when a state government goes bankrupt for a long period of time, say 6 months to a year? What if the Fed can't give grants, and loans to keep state services open?

Answer 1

Bankruptcy of government will lead to anarchy since when government officials are no longer paid, they will stop working and will abandon their offices paralyzing entirely the government operations.

Answer 2

The federal government can't go bankrupt, since it controls the money supply.

Lower levels of government can file for bankruptcy court protection and reorganization. This has never happened to a state, but it has happened to several city and county governments.

Answer 3

I believe you guys elected the Bush administration right. keep believing that other countries' problems are your problems. You go to war with the country that has nothing to do with 9/11. Your economy is driven by consumption and China's economy by production. Your president don't even understand economics 101. You people's attitude of he is a Christian, I am a Christian, so I will vote for him no matter whether he is qualified is down right stupid. Religion and politics don't mix.

Soon, your money won't buy half as much as it did in the 90's. the U.S will pay down foreign debt with dollars worth far less than when it borrowed. China will start buying American assets with cheap dollars. Eventually, America will likely become borderline third world nation.

Answer 4

Another suppression...kind of like a pre-depression. The government ALREADY is in debt..we whole countless trillions to other countries, and Bush isn' doing a darn thing about it. The American dollar is pretty much worthless right now..the euro is the new "fab". Our government is a joke...

Answer 5

You aren't from MIchigan are you? lol. If any state would need a bailout.....we fit the bill. They(the fed. reserve.) which is a big fat lie forever, can't keep printing non-backed currency forever. I feel we allready are bankrupt. What makes our currency have any value? When's the last time we had a trade surpluss? You will see our money sink and sink and sink in value as time goes by. The Fed. Reserve can't cast it's ruse forever.

Answer 6

The US government has run out of money lots of times. They just borrow form other countries and then make more money that is not worth anything, because it is all made on borrowed money.

Answer 7

I find it to be highly unlikely that that will happen to the U.S. government but, if it does you can expect them to establish marshal law and take what ever they want from us directly instead of doing it indirectly as they do now.

Also, if it does happen, it will make America easy prey for a rival nation and could also increase the chances of anti-government revolutionaries rising up and successfully overthrowing the government.

Answer 8

We already print worthless money and 9 trillion in debt sounds bankrupt to me!

Answer 9

Another 1929?

Answer 10

depression