The Tennessee flood has devasted that city. Most of it is underwater and many residents’ homes have been destroyed. The mayor estimates the destruction is to the tune of more than one billion dollars. The last flood that came there was in 1976, so the new residents are not used to it.
The oil spill off the Gulf of Mexico is going to cost a lot of money in terms of environmental, livelihood of people and cleanup costs. A few months ago, the state of New York and New Jersey were hit by record snow and rainfall. How are we going to pay for all this? We are still locked in the Iraq war and the afghan war is nowhere in sight of winding down despite all the talks regarding withdrawing of troops from that place. Add to that the cost of the recession and the bailouts and we have more problems on our hands than we have resources (read money) to pay for it. Now we have to bail out Greece too (in the form of IMF loans which the U.S. is the largest shareholder).
As the folks who have been following my posts, we will eventually have to raise taxes, cut spending or both and it would not be pretty. The international obligations that we are taking on since nobody else wants to do it have left us pretty much penniless regardless of us being the biggest economy in the world. We will have to solve our domestic problem and prepare for contingencies and rainy days and for a while try to limit our international obligations for some time to come.