Our country still has a long way to go to get our nation’s fiscal house in order, but the new tone of the debate is a step in the right direction. The economic woes of the United States will not be solved in one budget alone. Our fiscal mess took years of uncontrollable spending by both parties, and as a nation we must make fundamental changes to our financial habits. Look no further than Greece, Portugal, Ireland, and even Italy for examples of how out-of-control spending could affect the U.S.

The ongoing Eurozone crisis should serve as a wakeup call to Americans. Much like the U.S., European countries have failed to show fiscal restraint but continue to offer expensive government services and have seen skyrocketing interest rates. As a result, several European nations have been forced to adopt severe austerity measures. While some European economies have shown signs of stabilization, the situation in Greece continues to worsen, putting added pressure on the Eurozone as a whole. Standard & Poor’s downgraded Greece’s credit rating from a “BB-minus” to a “B” over fears it may require an additional bailout or extension on its debt repayments. Economists now fear that the debt predicament, both domestically and abroad, may be far from over. If the United States does not take immediate action to rein in spending and pay down our debt, we could be subjected to similar financial extremes seen in Greece, Portugal, and Ireland where the credit markets are basically dictating this restructuring.

After watching countries in the Eurozone fall like dominos because of weak economies and exorbitant government debt, our nation must seriously consider the following: Could the United States be the next domino to teeter on the brink of collapse? Are we ready should this financial contagion infect us? The situation in the Eurozone should serve as America’s wakeup call about the need to get our finances under control.

According to information released by the Bank for International Settlements (BIS), the U.S. holds roughly $353 billion, or 17 percent of debt owed by Portugal, Italy, Ireland, Greece and Spain. That sum pales in comparison to direct U.S. bank lending to European nations which, also according to BIS, totals over $1.3 trillion. American and other foreign banks are limiting their exposure to troubled European banks, but many are doing so by selling debt to the European Central Bank (ECB). Late last year, the Federal Reserve extended the program to make U.S. dollars available to central banks worldwide, including the ECB. The Fed initially created swap lines with the ECB and other central banks during the height of the 2007-2009 financial crisis. In May 2010 the program was resurrected when financial strains reappeared in Europe. While the central banks protect the Federal Reserve against losses, it has the potential to increase U.S. exposure to the ongoing European crisis. Given the continued financial distress of Greece and it’s likely impact on the ECB, Germany and France (the two nations combined are exposed to Greece to the tune of $237 billion), it remains unclear whether or not the Fed will heed the warning from Europe and lessen its exposure by ending the swap lines on time.

The $1.3 trillion exposure of our banking system could turn out to be a relatively low estimate compared to actual figures. If the other shoe drops and things deteriorate, the few banks that likely hold the majority of the risk may find it difficult to weather the storm. In the age of “too big to fail,” American taxpayers may again be put in the position of bailing out our financial institutions because their government has turned a blind eye to the writing on the wall. Regrettably, American taxpayers could find themselves in the precarious position of having to again prop up American institutions, this time as a result of insolvent foreign economies. The United States must be prepared for what will happen should this crisis become worse and spread before the EU devises an appropriate course of action. Economic history has shown us that it pays to be prepared.

At home, the recent decision by Standard & Poor’s to change its outlook on U.S. debt from stable to negative, a move that has been forecasted for years, has gained the attention of the American public. Combined with the tremendous media attention over the Fiscal Year 2011 and 2012 budget resolutions, it is becoming clear to many Americans that our spending habits have caught up to us. Soon our nation will have to tackle another momentous issue in our debt ceiling.

The severity of the U.S. economic situation is irrefutable, and we are part of a world economy whose situation is precarious at best. It is time to take a long look at the European crisis and recognize that we may not be far behind.  To get our fiscal house in order we must continue to cut spending and enable our job creators and entrepreneurs to get back to the business of creating jobs. America needs to wake up and begin, in earnest, efforts to get our economy going again.