Posted on 12/30/2012 11:15:00 PM PST by neverdem
The fiscal cliff isn't as scary as the looming deficit and debt crisis about to swamp the country
All eyes have been on the clear and present danger of the fiscal cliffunderstandablybut there's a sound in the mountain range that's even scarier than the cliff. It's the sound made by an avalanche, the trillions of dollars of debt that's heading our way, gathering speed and mass. For most people, it's out of earshot now, and that's the way our government prefers to play it in its financial statements. Liabilities are not set out there in accordance with the well-established norms of the private sector, where this overhang of liabilities would set off alarm bells in the markets, with boards of directors in emergency sessions.
We'll come to why that's not happening, but let's consider first why we should regard our predicaments as gravely as any private company does on the path to bankruptcy.
We are on a trajectory of cumulative fiscal deficits that cannot possibly be sustained. We have gone from being the world's largest creditor nation, with no foreign debt at the end of World War II, to the world's largest debtor, with roughly half of our public debt held by foreign lenders. Over the last four years, our national debt has grown by more than $5 trillion to over $16 trillion. We have to service that debt. The Federal Reserve is keeping rates historically low but here's the cost of paying interest on the debt for fiscal 2012: $359,796,008,919.49
What do you get for that? Nothing.
The greatest fiscal challenge to the U.S. government is not just its annual deficit but its total liabilities. Our federal balance sheet does not include the unfunded social insurance obligations of Medicare, Social Security, and the future retirement benefits of federal employees...
(Excerpt) Read more at usnews.com ...
Since we print out own money and loan it to ourselves bankruptcy isn't possible.
Its just like the SS trust fund. We can cut FICA/SS payroll taxes when SS is already running deficits and it still is called 'fully funded as far as the eye can see'.
“Since we print out own money and loan it to ourselves bankruptcy isn’t possible.”
But hyperinflation is... And that’s worse.
Obama voters don’t care.
They want their benefits and they want them now!
Debt? What debt?
Mister Zuckerman is SPEAKING the TRUTH... but the GREATER question is... is ANYONE listening???
The question is not whether we must make the tough choices to put our nation's finances in order. The question is whether we will do so before the market forces us to do so.
The politicians will do so only if forced to by "the market".
Ironic, isn't it?
Precisely.
That cartoon at the top of the pages of the Zuckerman column is a real head shaker. The cartoonist thinks 300 million Americans give a rat's behind about the deficit or national debt? Please...
As you noted, the Democrat moocher class couldn't care less about any of that crap.
But that's neither here nor there. We have a situation where the federal government can borrow virtually unlimited amounts from foreign sources interested in putting their money in our hands simply to protect its value.
We aren't really paying that much interest on it.
Remember, in normal times interest is an attractant but in times like these fear causes people with money to protect it from their own governments by handing it over to us.
That's been going on for most of two centuries!
We continue to suffer from deflation across a broad sector of the economy.
The U.S government cannot borrow unlimited funds! As our credit rating errodes
higher interest payments will be demanded by the debt holders.
This is pure fantasy. Greece, Spain wake up!
Of course not. With interest rates at rock bottom it don't look too bad does it.
Raise interest rates a few points and suddenly your in nose-bleed country. that 359 bil goes to over a trillion PER YEAR. FOR ABSOLUTELY NOTHING.
Interest rates held artificially low by people appointed by the very same politicians that NEED, DESPERATELY to stay ahead of the ball, keeping the deficit as low as possible or they're gonna need those billion bullets they been buying over the last bunch a years.
And yet, every dollar that the govt borrows is another dollar that private industry CAN'T borrow to actually build jobs that could dig us out of this abyss.
Ain't NO way out of this hole.
Just gonna get worse.
I don't see much deflation outside of wholesale commodity costs.
And when I do, it's related to oversupply issues, not monetary or normal demand issues.
Home prices are still drifting lower in southeast Florida, Las Vegas, and central California, but drifting higher or stable in just about every other region.
Wages and benefits are slightly lower for low skill jobs, but that is related to a massive oversupply of legal and illegal immigrants.
Desktop PC’s cost less, but that is because people are substituting notebooks, tablets, and smart phones.
Video game consoles are cheaper, but that's because of a host of new game playing options.
Taxes and interest rates are lower, but that is because of government manipulation, and could change instantly if we create a currency crisis.
On the other hand...
My rent is up 8% in 2012.
Food up 10%.
Gas up a little from last year.
Health and car insurance up.
Basic clothing up.
“Curiously, he still says taxes should be raised, “in a way that doesn’t discourage effort or cause capital flight”. Good luck with that. Mort also thinks entitlements must be “means tested”.”
Mort Romney. They keep on trying. And not a word on 800,000 civilian “employees” of the Pentagon, and all the other bureaus and fed. agencies.
FLAT TAX....EVERYBODY needs some skin in the game!! ANd EVERYBODY needs to PAY THE SAME RATE!!!!
FLAT TAX....EVERYBODY needs some skin in the game!! ANd EVERYBODY needs to PAY THE SAME RATE!!!!
I wonder where this ends, America with a Hitler, America the enemy of liberty and freedom?
Tourism is down ~ PERMANANTLY. There was a time folks took formal trips and stayed precise amounts of time. Today they buy a new battery and lounge on the couch.
Clothing lasts far longer. Machine-made custom shoes are gradually infiltrating the market and they'll really drive down footware costs.
Some hidden costs, like 'design' have dropped precipitously and we still have a 15 year overhang in housing ~ the only place property values are increasing are in critical locations ~ like where I live. Super highway into the heart of WarshDC itssef, a ginormous subway station, and two different commuter rail systems are a walking distance away. This is the route of the helicopters from the Pentagon to Quantico and points in between. Beginning to look like that transport corridor in Futurama.
Deflation has every reason to not go away
ANd EVERYBODY needs to PAY THE SAME RATE!!!!
The “Takers” don’t even report their income because the tax law states they don’t even have to report their income annually if they make an “adjusted” income less than $6,000 yearly. Notice the “adjusted.”
A national sales tax is the only fair tax because the tax would be collected as the sale was made by the retailer/wholesaler and the best part is that the “takers,” welfare cheats, whores, drug dealers, the underground economy and other parasites upon the tax paying hard working and honest citizens would have to pay each time they bought something.
The best thing is that the average American can save their money and only pay a tax as they spend it.
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