The Republicans and the Democrats are united about the need to rein in government deficits that threaten to overwhelm the economy, but they are sharply divided over how to do it.

The Republicans want to cut benefits and overhaul the health program whereas the Democrats, led by Vic-President Joe Biden, have presented a plan under which $1 trillion can be saved by trimming spending over a period of ten years.

However, there are some experts who are not convinced by either plan to address the serious crisis the nation is plunging into. There are some who think the fiscal shape of the US is worse than that of debt-plagued countries like Italy or Spain.

The financial condition of the United States is much worse than advertised, said David M. Walker, former chief of the U.S. Government Accountability Office, according to the Wealth Daily.

In 2006, when the federal debt was only $8.5 trillion, Walker had warned that the fiscal path was unsustainable. Currently the debt has ballooned to $14 trillion, which is an increase of about 40 percent.

Walker now warns that the unsustainable debt is pushing the country into a danger zone. He warns that the worsening of the debt crisis means dramatic hike in interest rates, a free fall of the dollar and higher inflation. The negative impact of this scenario will be felt across the world, bedeviling economic recovery everywhere.

And there won't be anyone to bail out America, he says. ”This ship, in other words, is one that can be easily sunk.

Today, the mammoth U.S. Government spends $6 billion a day more than it brings in, causing the nation to slam into the $14.294 trillion debt ceiling. That's over $45,000 for every man, woman, and child in America, Steve Christ wrote in Wealth Daily.

The piling debt then takes a toll on dollar. The government borrows more and more to bridge the gap and prints dollars to finance its entitlement-oriented budget. In this process, U.S. securities lose the sheen over a period of time and critics argue that there will be a time when international investors refuse to have anything with U.S. government debt. This will cause a nosedive in dollar's value.

The critics accuse the Federal Reserve mandarins of engaging in the outright destruction of the dollar. The Fed's Quantitative Easing policy has caused the rapid deterioration of the country's stability, says Luke Burgess.

... With an additional $80 billion flooding the money supply every month, the price of everything inevitably skyrockets... It's a Mad Hatter monetary system that's literally crippling our very livelihoods, he adds.

He reasons that since 1971, the dollar hasn't been backed by anything other than the fact that it is the world's reserve currency. The need for dollars to buy international goods is the only thing that gives the dollar any strength at all. However, as billions of dollars are pushed on to the market through the Quantitative Easing program, its value suffers.

...it's the Fed's constant devaluation of your dollar — killing your purchasing power with each passing day, Burgess writes. He says that the dollar dropped 10 percent in value since the Fed began its second round of money pumping.

Federal reserve Joe biden Government accountability office Quantitative easing