Posted on 07/12/2024 7:45:01 PM PDT by SeekAndFind
"Will Debt Sink the American Empire?"
So asks the Wall Street Journal, in an uncharacteristically gloomy article for the bull market's paper of record.
They kick off with the problem: America is "cruising" into an uncharted sea of federal debt, with a government seemingly incapable of turning it around.
In other words, the uniparty has set its course, and there's no cavalry coming.
We're currently adding a fresh trillion of debt every hundred days, on our way to $35 trillion.
Meanwhile, the deficit is about to break $2 trillion – for perspective, all federal revenue under George W Bush averaged around $2 trillion.
Debt interest *alone is set to cross $1 trillion, eclipsing even our bloated military budget that beaches quarter-billion dollar piers in Gaza for sport.
The next milestone after that is Medicare spending, which together with Social Security has its own $78 trillion unfunded liability, according to its own Board of Trustees – outside estimates are higher.
Now, none of this is shocking: governments by nature try to spend too much – indeed, much of economic history is made up of governments desperately trying to finance their mountains of debt.
Debt brought down Rome, first with hyperinflation then with a gutted military that barbarians walked right over.
It brought down Spain, as New World gold finances an effective government takeover of the private sector. And France, bankrupted by financing foreign wars – in this case, the American Revolution. The Qing collapsed under debt and even Great Britain who owned half the earth for nearly a hundred years.
It's why we got the Magna Carta – indeed, Constitutions – as kings pleaded for more money. It's how we got central banks, as first Britain then the rest of the world licensed money printers in exchange for debt finance.
To this day government debt crashes countries – countries from Turkey to Venezuela to Nigeria are currently undergoing debt crises, with Argentina desperately trying to pull out of one.
And, with so many historical cases, we know exactly how this ends: investors stop buying government debt, shutting out governments and leading to massive austerity and soaring inflation as the government retrenches.
Going by history, the government will cancel the trillions it promised — starting with Social Security and Medicare — then pull back to where it can pay the Praetorian Guard and not much else.
In short, once debt hits the magic line, Washington goes from Sugar Daddy to wild animal. And, historically, it happens much faster than people imagine — in Hemingway’s famous phrase, countries go bankrupt gradually then all at once.
Washington’s spending freight train can be stopped – in fact, we did stop it in the '90s under Clinton and Gingrich: From 1997 to 2000 we ran budget surpluses totaling nearly $600 billion.
The key was gridlock – two parties that despised each other so much that the only thing they could agree on was to sabotage each other’s plans.
Unfortunately, whether it was corporate donors or golden parachutes for politicians, both parties have long since folded and are now eager to cooperate so long as they both get everything they want. So Democrats feed their activist army at taxpayer expense, while Republicans instead give ammo to Ukraine.
This all means there is a ray of fiscal hope.
If, say, President Trump were to face a democrat Congress that hates him so much it blocks everything he does – not an impossible thing to imagine.
Or, if you swing that way, a President Biden – or Harris – is subjected to similar antipathy from a GOP Congress.
Or, dare we dream, a GOP that actually stands up on the debt ceiling, damn the media torpedos or wait a couple of years and it's a crisis in the entire country.
We know which one Washington will pick. But it's ultimately the voters who run the joint.
Yes.
If it doesn’t the greed, corruption and lethargy will.
Almost certainly.
The debt will be cancelled - all of it.
What it will take for that to happen is unknown and unknowable at this time. But a simple knowledge of history tells the story, over and over.
“Owe the bank ten thousand and can’t pay? You have a problem. Owe the bank ten million and can’t pay? The bank has a problem”
“The wicked shall be turned into hell, and all the nations that forget God.” Psalms 9:17
Already doomed...
It was Bush Cheney and the deal for the WOT and the Invasion of Iraq to fix the Middle East that got this all going.
Market will ramp up and in the course of 3 days drop 20%.
Ask yourself where did that go?
Yeah, between the creation of the Federal Reserve, the direct election of Senators, and the National Income Tax more than a century ago, the event has already occurred.
No Nation in the history of the World survived such debt like we have, the Germany Republic after WW1 only had 1 trillion in debt...
Declare bankruptcy with the Federal Reserve, a private non governmental entity.
US then has a currency crisis, develops into a Venezuela scenario, government shuts down for lack of financing….the good news? It can rebuild on sound money principles- if our enemies don’t finish us off.
They won't take it well when the handouts stop.
Surely this is a joke...
The American “empire” no longer exists in any residual form...
All that remains is a Soviet-style 3rd word country...
Interesting that Italy and france can control their debt but the United States cannot. We need to study why they are smarter than we are.
Can’t Biden just forgive the debt like the student loans? Obvious sarcasm but it needs to be pointed out as such for a few.
“...We also have tens of millions of migrants, and tens of millions of American underclass, who rely on government handouts....”
They are going to die, ALL OF THEM, within the first 90 days of a government collapse. They will first resort to cannibalism but quickly run out of flesh to feast on. Many democrats in the shithole urban ghettos do that now.
They will also riot and burn down their OWN cities but to no avail. NO ONE is coming to help them! It is going to be glorious. /spit
Elites confiscate all wealth of the non-elites. Move to digital currency. Control everything. World Economic Elite Empire. WEEE!!!
And fifteen years later they damn near conquered the world.
Stop focusing on money. On September 2, 1945 all your yen were worthless. Look at Japan now,
The money system will be rebuilt. The usurers will hang or flee. It will be fine.
That $$$$$$$$ is going into evil leaders’ pockets all over the world. Strange how the common man has to at least try (in these hard times) to live within his budget but governments can spend other people’s money willy nilly. FJB wrote and check to Z, the guy he calls Putin, this week.
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