Addicted to debt and devoid of industry, Great Britain faces economic catastrophe. But if Britain crashes, it will not crash alone. It won’t be the story of an isolated island fading into history, but of 200 years of Anglo-Saxon dominance coming to an abrupt end.

Even though it’s not even on the radar screen for most Americans, Great Britain is headed toward a debt crisis, and thus a currency crisis. On January 8, the Telegraph reported that Neil Woodford, head of Invesco Perpetual, said there was a “high probability” of Britain losing its aaa credit rating—something that has never happened before.

Taken alone, Mr. Woodford could be passed off as a doom-and-gloomer. But he is far from alone. Just days earlier, pimco, the world’s biggest bond house, declared it was selling its UK government gilts (government debt). According to pimco, there is an 80 percent chance that the British government will face a credit rating cut. If that happens, UK government bonds will plunge in value, so pimco is getting out while it can.

Floundering in its worst depression in 80 years and facing its biggest budget and trade deficits ever, it’s surprising Britain hasn’t had its national credit rating cut already. Some blame the credit rating agencies for being corrupt; others argue that they are incompetent. But the truth is that it is no easy thing to downgrade one of the largest economies in the world toward junk status. Trillions of dollars hang on a few paragraphs in a report. In actuality, Standard & Poor’s and the other major credit agencies have warned multiple times that unless the government does something to cut the deficit and fix the economy, Britain’s aaa rating will be removed.

It is one thing for Greece or Iceland to get its credit rating cut. It’s quite another when you are talking about the world’s fifth-largest economy and its biggest banking center. The ramifications could be catastrophic to the global economy.

If Britain were to lose its rating, it could force many investors and pension plans to sell their UK government debt bonds. The cost of UK government borrowing could skyrocket—the last thing Britain needs right now. As it is, the nation is trying to borrow record amounts from foreign investors to pay its bills and revive its economy.

To make up the shortfall, the British central bank is creating money out of thin air to lend to the government. The euphemism used by central bankers and politicians for this money printing is “quantitative easing.” If the term sounds familiar, it’s because that is the same process the United States is embarking on. It’s also what Zimbabwe, Argentina and Weimar Germany have embarked upon in the past.

Already investors seem to be anticipating a UK default—not just by inflation, but an outright default. The cost to insure British government debt against default is only slightly less expensive than covering Portugal. Projections indicate that the UK will need to borrow or electronically create another $1.13 trillion over the next five years—an incredible amount for an economy one fifth the size of the U.S. If the economy doesn’t improve, Britain may need to come up with a lot more. The borrowing could take the UK national debt to almost 100 percent of gross domestic product by 2014—a level that many economists and many market movers consider the “point of no return” for an economy.

“Countries can run up as much debt as lenders will allow,” notes economic analyst Jim Jubak. “And right now the signs are that lenders are getting nervous about keeping the tab running for the United Kingdom.”

If lenders stop providing the easy money to the UK government, then the pound could be in for a serious fall—not the relatively minor 29 percent fall it has had against the euro since the current economic crisis began. If the foreign money dries up, then it will be off to the racetrack for the printing presses, with the finish line somewhere in banana republic land.

To this point, some UK politicians and economists actually look at the pound’s devaluation as a positive, saying it helps make UK exports more competitive. The reality is that Britain doesn’t export much. Its manufacturing industry—once the prize of the world—is decayed and largely gone. Even with the pound plummeting, the trade deficit has barely improved. Britain is still a major importer from everything from food to fuel. And with the pound falling, the costs of all these imports are going up. Not a good recipe for higher consumer spending and a lasting recovery.

Pound sterling is headed for another rout—the only question is when.

But if the UK is in trouble, America might not want to look in the mirror. According to Jubak, America had better hope that Great Britain can work its way out of its bind without a full-scale financial crisis. “The last thing I want is a crisis that would focus everyone’s mind on how similar the budget picture looks here,” he says.

Yes the similarities between America and Britain are everywhere: Massive debt, shaky currency, lost industry, chronic trade imbalances, corrupt politicians, broken trust.

On January 14 the Wall Street Journal revealed that California’s bonds are now rated by insurers as riskier than those of Kazakhstan. California, if it were a stand-alone country, would have the 10th-largest economy in the world. Arizona, Illinois, Kentucky and Virginia may be in just as poor shape as California. As for pimco, the bond fund with over a trillion dollars under management, it has announced it is paring down its holdings of U.S. government debt too—reducing its risk that the U.S. government could soon face a credit rating downgrade just like Britain.

“There will, before long (my best guess is between two and five years from now), be a global dumping of U.S. dollar assets, including U.S. government assets,” says former Bank of England policy maker Willem Buiter. “Old habits die hard. The U.S. dollar and U.S. treasury bills and bonds are still viewed as a safe haven by many. But learning takes place.”

“The past eight years … [have] left the U.S. materially weakened financially, economically, politically and morally,” he said. “Even the most hard-nosed … indifferent potential foreign investor in the U.S. must recognize that its financial system has collapsed.”

Genetically, America and Britain’s plight couldn’t be more similar—and precarious. As the great banking meltdown of September 2008 revealed, America’s and Britain’s economies are tied at the hip.

The history of the United States and Britain is unique in the world. They have a blood-brother-like relationship. In the past, during times of great national crisis, that relationship has worked for good, with one supporting the other.

Today, however, the opposite is occurring. The bonds of brotherhood, the special relationship and spirit of cooperation between these two countries have broken down. Now the global economic crisis, which started in America, looks set to wreck Britain. And when Britain goes down, it can’t help but drag America with it.

To read more about the special relationship between the U.S. and the UK, and why these two countries are destined to fall together, read the book The United States and Britain in Prophecy. It will open your eyes as to why America and Britain are plagued by so many of the same problems and will reveal the solution to the crisis these two nations face.