With yields on Italy’s 10-year government debt rising sharply higher and beyond the seven-percent ceiling deemed unsustainable, Italy is running out of options in finding buyers for its debt. It is also running out of options as a sovereign nation.

While the global powers are speculating over the possibility of an Israeli military strike against Iran, many analysts are saying that such an endeavor would steeply raise the price of oil. As a preemptive attack by Israel —  on its own — seems increasingly more likely, oil has already increased $1.17 a barrel to $115.73, the highest price in the last two months.

The downward spiral of the Greek economy — and now likely that of Italy — has led to calls for the European Union to step in and prevent a total collapse. Portugal, Ireland, and Spain — the other three of the so-called PIIGS EU member-states — are enduring their own woes, such as downgrades of sovereign debt and corresponding jumps in the interest rates on government bonds. The cumulative effect — particularly if Italy does suffer a crisis serious enough to reduce its national credit rating to junk-bond status — will ripple throughout Europe and across the Atlantic.

Silvio BerlusconiWith Greece’s Prime Minister George Papandreou agreeing to step down in order to secure more bailout funds from the ECB, attention turned immediately to Italy’s financial problems that dwarf those of Greece’s. The Greek PM’s decision now clears the way for an interim government to agree formally to the new austerity measures demanded by the European Union as a condition of receiving additional financing by the end of the month. Those funds are needed to pay Greece’s bills through January 2012.

Government programs often begin with limited, easily identifiable purposes, then grow over time to become expensive, wasteful, and even dangerous monstrosities. Such is the case with the federal War on Drugs, which began with little fanfare under a modest 1914 anti-narcotics law and has since grown to enormous proportions, eviscerating the Bill of Rights and entangling the United States in countries all around the globe in a futile effort to eradicate the supplies of highly sought-after commodities.