Despite favorable demographics, a relatively small tax base and a small welfare state (compared to other advanced nations), many people are alarmed at the level of public sector deficits and debts.

Is The U.S. Bankrupt? - Seeking Alpha

Well, that article met some stiff reactions, but here is a thought. In almost any respect, the Netherlands is significantly worse off:

• The population is barely growing, Dutch demographics are considerably worse in the Netherlands compared to the US
• The Dutch Welfare State is really considerably bigger
• The Dutch tax/GDP ratio (38.4% in 2010) is much higher compared to the US (24.8%)
• The Netherlands doesn't issue its own currency
• Dutch private sector debt is one of the highest in the world
• Dutch house prices are still falling, so household balance sheet problems are worsening, not improving
• The economy is stagnant (the combined result of private sector deleveraging and public sector austerity) and unemployment rising rather rapidly.

It depends a little how you measure it but a kind reading would argue that the Netherlands has a mildly smaller public debt/GDP ratio (at 71%) compared to the US, but that's about the only advantage it has (and we think the advantage would shrink if one simply deduct the Fed holdings of US debt from the total, as there is really no Dutch equivalent of that).

To our knowledge, there really is nobody in the Netherlands that argues that it is bankrupt, or faces such a dire public finance future that we ought to take drastic measures here and now. If anything, austerity is the policy du jour, basically to keep the public deficit within the 3% limit of the eurozone fiscal compact, since the Netherlands is with Germany on lecturing others about that, so it is basically forced to take its own medicine.

There are a host of economist that argue that when the private sector is deleveraging, the public sector shouldn't compound that by embarking upon austerity.