These fiscal and capital flow deficits are merely side effects of imbalanced trade flow. China best illustrates Ponzi capitalism's abject failure: that country has now achieved and in many ways surpassed the capabilities of many developed nations. At this stage they make almost everything, and if they put their minds to it, they could make anything. Imagine a world in which the Chinese can make everything we make but MUCH cheaper, and corporations have free choice where to source from - that's the world we live in.
Therefore, apologists for the status quo have yet to explain why China's industrial ascension hasn't led to a large and growing Chinese middle class. And the answer of course is obvious:
1) The total size of their population is too large
2) The relentless Multinational arbitrage between First World and Third World labour, inflates profits while deflating wages i.e. the same arbitrage constantly undermining the developed world's middle class
3) The sheer lack of available resources preventing the consumption-oriented lifestyle from scaling across billions of additional people