It does appear to be a possibility, however not in the next few years.
** CAUTION LONG POST **
Consider: Greece was bailed out by USA and other large countries. On it's own, their government would not have been able to pay even it's essential services workers such as Police, firefighters, paramedics, etc. within a year.
Luckily the IMF (USA is 25% shareholder) bailed them out, now they only have to raise taxes and cut services somewhat, rather than completely.
It's well documented that when essential services are cut (employees stop being paid), a nation can fall into anarchy within days, and then either the military takes over or it becomes a third world warlord-ruled state.
Now consider that the USA is in worse financial straits than Greece, only about 7 years behind.
http://www.cnsnews.com/news/article/67183
The IMF cannot bail out the USA, so there is only one solution: Raise taxes and cut services. The question is, will the citizens of your country accept working harder and earning less due to the addictive-criminal activities of their government, or will there be mass civil unrest/revolution? Greece citizens went quietly into the night and are now in the midst of 'austerity measures' (economic slavery) to pay off a portion of their debt to the bankers. There is civil unrest there however the police and military are cracking down on it and there is also a lot of censorship in the media to hide the cause and extent of the problem from it's citizens.
They are only a small country, so they--while facing the belt-tightening of austerity--will be relatively okay due to the international aid. What happens when a country with 33 times more people than Greece also feels that austerity, except with little or no international aid?
Some services in your country are already starting to feel the squeeze:
http://www.bloomberg.com/news/2010-08-02/california-bond-shortage-shows-most-indebted-state-eludes-borrower-penalty.html
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2010/08/09/BABM1ERE21.DTL
http://www.nytimes.com/2009/02/10/us/10prison.html
http://www.bloomberg.com/news/2010-08-04/new-york-senate-passes-869-million-revenue-bill-to-finish-overdue-budget.html
All those relevant links above point to the states borrowing more money from its citizens and the treasury to cover it's finances, knowing that the interest on those loans is increasing and must be paid back.
The root of the problem is this: Economies spending what they don't have, and lenders lending what they don't have.
The current financial depression was caused by both.
So those links above show that the large economies are still trying to borrow themselves out of debt(ie. drink themselves sober), knowing that they're just prolonging the collapse and making it worse for Joe Public in the end.
Federal Reserve promises to help boost economy ... Again.
Even your countries most prominent financier is lending out MORE unbacked freshly printed money, to help states and large banks pay their bills.
This is like a drunk who is in need of a stomach pump taking another deep swig of Smirnoff.
That money has to be paid back eventually.
Two choices:
1. Austerity now, meaning MUCH higher taxes and far less services.
2. Austerity later (or when it comes), meaning road warrior anarchy "Book of Eli" type scenario.
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For those that don't believe, it's very simple. Pretend it's your personal finances. You can pay off one credit card with another and keep borrowing to pay for your living expenses, meaning eventually your salary will go only to cover the interest on the debt. Once this happens and you can't afford to feed yourself or put a roof over your head, you will have to sell your car/computer/ipod/television/shoes/stereo/wedding ring/etc. just to feed yourself while paying off those debts.
In Greece they sold off some of their most precious islands:
Greece starts putting island land up for sale to save economy to private buyers to help pay off their debts. This is equivalent to you selling your Lexus and plasma screen television to your neighbor in order to buy food and keep a roof over your head.
So while the Federal Reserve keeps printing money to finance the federal governments expenditures, just know that it's your countries' future that you're selling off, and the future of your children and their children that you are committing to a life of economic slavery to pay for the gambling addiction of your government.
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To OP:
Best way currently to protect yourself is to imagine how to live in a world without essentail public services and degredation of Rule of Law:
1. Pay off all your personal debts.
2. Buy physical gold for investment as a hedge against inflation.
3. Stock your pantry with as much storable food as you can buy.
4. Buy a gun and learn how to use it.
5. If you are guilty of political apathy for how your elected government spends your money and how private banks raped your future, then apologize to your children for helping clamp the iron shackle of Austerity on their ankle.
http://www.corbettreport.com/articles/20100622_austerity.htm
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Might seem doom and gloomish but the personal protections against it are liberating and you will gain a sense of personal freedom for taking control of your future, regardless of what those in Washington decide they have in store for you.
cheers!
Do your own research and prepare!!
