Question I read your previous answer to a question about other countries owing the government. money, but it didn't quite answer what my question is. In light of this, i ask, why can the great US government. Just ask everyone that owes money to hand it (or a partial amount) over? Would that not help our situation?
Answer Yes they can ask for the money, but the other side can say one of two things:1) we are in worse shape than you are and we can't afford it, or 2) When you pay your billions in your outstanding debt, then we'll get around to repaying you.
There is no way to "force" a country to pay, short of going into it and taking stuff (usually called an "invasion" - that actually is what Saddam Hussein did when he went into Kuwait. He wanted their oil, and look where that got him).
Countries that owe the World Bank or private individuals, and don't pay, can have their bond and credit ratings lowered, and they would then find it more difficult to borrow money from private lenders (also other countries), but if a country doesn't want to pay, it won't.
If you look at Zimbabwe, they defaulted on all their outstanding debt, so now they can no longer get loans. The result is they just started to print money (very similar to what Obama is doing) and their inflation rate is somewhere around 1200%. They are printing million dollar bills so people can buy things (last time I looked, bread was $10,000 a loaf), and that money is worthless outside the country because no one will take it (after all, it's just paper with ink on it).
So, unless a country wants to repay its debt, it doesn't have to do it, and we can't "sue" them to get it. I think I previously mentioned that the U.S. owes the United Nations a couple of billion dollars. We still send them some money, but not the amount we said we would, so we owe them those funds, and we aren't paying because we don't want to do it. Even if some entity takes us to the World Court in the Hague, and they say we have to pay, we don't have to if we don't want to give up the money. Such is life.
Of course, to avoid being like Zimbabwe, countries to try to pay off their immediate debts, but when they can't, there isn't much anyone can do about it.
