Posted on 12/12/2014 12:18:03 PM PST by Rusty0604
Exactly 199 years ago, in 1815, a “temporary” committee was established in the US Senate called the Committee on Finance and Uniform National Currency.
It was set up to address economic issues and the debt accrued by the US government after the War of 1812.
Of course, because there’s nothing more permanent than a temporary government measure, the committee became a permanent one after just one year.
It soon expanded its role from raising tariffs to having influence over taxation, banking, currency, and appropriations.
In subsequent wars, notably the American Civil War, the Committee was quick to use its powers and introduced the union’s first income tax. They also detached the dollar from gold to help fund the war.
This was all an indication of things to come.
Over the subsequent decades there was a sustained push to finally establish the country’s central bank that will control money and credit, as well as institute a permanent income tax to feed the expanding aspirations of government.
They succeeded in 1913 when the Federal Reserve Act was passed and the 16th Amendment ratified, binding the country in the shackles of central banking and taxation of income.
Over the century that followed, the US has gone from being the biggest creditor in the world to its biggest debtor.
Decades of expanding government programs, waste, endless and costly wars, etc. have racked up such an enormous pile of debt that it has become almost impossible to pay it down.
A lot of folks don’t realize that, since the end of World War II, the US government’s total tax revenue has been almost constant at roughly 17% of GDP.
In other words, even though the actual tax rates themselves rise and fall, the government’s ‘slice’ of the economic pie is almost always the same - 17%.
I’ve worked out a mathematical model which shows that, even with absurd assumptions (7%+ GDP growth for years at a time, low interest rates, etc.), it is simply not feasible for the US government to ‘grow’ its way out.
Default has become the only option. And that could mean a number of things.
They could default on their creditors (other governments like China who loaned money to the US government). But this would spark a global financial and banking crisis.
They could default on the Federal Reserve, which owns trillions of dollars of US debt. But this would create an epic currency crisis for the US dollar.
They could also default on their obligations to their citizens—primarily to future beneficiaries of Social Security (who collectively own trillions of dollars of US debt).
Or they could choose to default on their obligations to every human being alive who holds US dollars… and engineer rampant inflation.
None of these is a good option. And simply put, the US government has reached a point of no return.
I aim to demonstrate this to you in today’s video podcast episode. It’s a very sobering realization.
Join me to see it for yourself:
I just wonder when the day of reckoning will be?
Erode away a building’s foundations and the reckoning might come slow or it might come suddenly. You don’t really know. But either way, it ends up flat on the ground.
“And this president is responsible for 11 trillion of the 17?”
No, the Congress is responsible for that. All spending originates in the house, so if the RINOs were not complicit, it couldn’t have happened.
I don’t make a distinction between the GOPe and the ‘rats anymore.
They’re both governing against the will of the governed.
Or the government could nationalize the debt which will very likely happen following the coming financial collapse
How about ending all foreign aid immediately and making Hussein and the democrats account for the all of the stimulus money for starters.....
The dollar is the world currency...so in some ways debt is meaningless....
At some point the “value” of the dollar will be reset to adjust for the debt....
Poof...it’s gone....
Of course the US citizens will be left with devalued currency, probably 50 on the dollar, but we will be solvent...
Think of it as trillions of your dollars funding liberal special interest groups who will fund Democrat party elections for the next 100 years.
Anarcho-socialist-Communists are waiting in the wings for that "collapse" to occur.
“If things can’t continue going the way they are, they won’t.”
I think that was attributed to William Crystal’s father, Irving Crystal.
When you owe the bank a $1,000 and can't repay it, you're in trouble. When you owe the bank $10 million and can't repay it, the bank is in trouble.
When our country owes over $18 trillion in debt and we can't repay it, we're not in trouble, the debt holders are. Of course, that's simplistic but it makes the point. If we were to default on our debt, this analogy doesn't factor in the steep inflation of the dollars (or whatever the government issues as new currency) that would occur when we used them to conduct our daily business and financial affairs. The currency would be worthless.
It is the world currency...for now.
——It is the world currency...for now.-——
And will be for a very long time... No country in the world is even remotely ready to have their currency replace it....
Don’t embarrasses yourself by saying China....
“Yuan to supersede dollar as top reserve currency: Survey”
http://www.cnbc.com/id/101450365#.
“Yuan Has Real Shot at IMF Blessing on Reserve Status”
http://www.bloomberg.com/news/2014-12-11/yuan-has-real-shot-at-imf-blessing-on-reserve-status.html
So?
Just REPUDIATE the debt. Refuse to pay.
Throughout history, that is what governments HAVE ALWAYS DONE.
Exactly what’s so different about today?
The Headline is quite misleading ...
I did actually read it. I don’t think the yuan will ever replace the dollar, but they are setting up some trade with their currency. No currency stays the reserve currency forever.
“He obviously intentionally ran it up in order to make paying it off impossible.”
Not just Obama. Since January 2011 the Republicans in the House have been complicit in every dollar spent by the federal government and every dollar added to the debt. Just as they were today.
“Run thy business or thy business shall run thee” Ben Franklin
heh.
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