It's getting very expensive for European countries to borrow money -- not just Greece and Ireland, but, also Spain, Portugal, and Italy. The U.S., on the other hand, can still borrow money incredibly cheaply. Here are the figures from today:
This, at the moment, may be the most important distinction between the debt picture in the U.S. and Europe. It means that the U.S. can continue to finance its deficit spending relatively cheaply, while European countries are forced to spend more and more just to pay the interest on their debt.
(In fact, when investors get worried about Europe's debt problems, they tend to put more money into U.S. government bonds, which are still considered to be among the world's safest investments. That makes it even cheaper for the U.S. to borrow money.)
There are, of course, some key differences between the U.S. and European economies at the moment. Ireland wrote a blank check to bail out its banks, which were much bigger relative to Ireland's overall economy, and in much worse shape, than U.S. banks. Spain has 20 percent unemployment, and the nation's banks may yet need a bailout.
Still, if you look at the larger debt picture, the U.S. doesn't look so different from countries in Europe. As a percentage of each country's overall economy, for example, the national debt of Portugal and Spain is comparable to the debt of the U.S.
And in the long term, the debt problem for governments in the U.S. and Europe will be driven in large part by demographics: More elderly people drawing on government retirement and health-care programs, and fewer working-age people to support them. That's one of the central issues President Obama's debt commission is looking at, and it's been a big source of tension in Europe.
The shift will be big in the U.S. -- and even bigger in much of Europe.