As we head deeper into this oncoming depression, with the Fed and Treasury stacking trillions of dollars of debt on to the the backs of the American people, I can only see four directions the US can take in order to deal with this debt. They are all terrible:

1) Radically cut Government spending and raise taxes.

2) Create massive inflation in order to pay back debts at $.30 on the dollar

3) Default and pay no one back

4) Clawback: a major redistribution of wealth in order to pay back debts with the assets of America's richest people

1) If the Government radically cuts spending and raises taxes, Government jobs will disappear and Americans will have even less money to spend after taxes. A great depression will become an even greater depression. Civil unrest will follow. The solution for the individual might be to move to a country less prone to violence, like New Zealand (of course, other countries may not want an influx of Americans).

2) Massive inflation will make the USD extremely weak. In order to achieve inflation, more money needs to get into the hands of the people. This means we all go to work for the Government. Whether we work as government paid private contractors, like Blackwater, or as bureaucrats, like Rham Emanuel, the Government pays us in copious amounts of dollars. The solution for the individual might be to leverage his/her way into real estate and then pay back loans with what will become nearly worthless currency.

3) If the US defaults on its debt, other countries will not get paid and will stop exporting to us. Everything will become more expensive, and we will have massive inflation anyway. A domestic default, in which municipalities and states stop paying Government workers, will result in riots. The solution for the individual might be to hoard food and buy physical protection until which time he/she can sneak over the border to Canada.

4) Clawback can only result in a bloody revolution. The solution for those who are rich is for them to get their money out of the country and find a place to go in which they can live to spend it. Count on gold confiscation.

America can not re-industrialize its way out of this mess. We can't match the rest of the world's cheap labor. The FIRE (Financial, Insurance, Real Estate) economy replaced the manufacturing economy in America, and the FIRE economy has now burned out. Our paper pushing, middleman economy has been running on pure debt for the last 40 years. Those days have come to an end with the credit bubble collapse. Americans will have no choice but to learn to become more self-sufficient. We all can't be working government jobs, and high tech and outsourcing have forever killed the private sector job market. I hope I'm wrong about all this, but we have put the same people in power who created this disaster, and just as they have pumped and dumped their stocks to achieve great wealth, they will pump and dump what's left of America until they feel it is time to leave with all their loot. A person such as Marc Rich has already set the precedent, and serves as a fine example for them.