Posted on 03/05/2011 6:41:53 AM PST by Son House
RUSH: We're gonna have to put this chart up at RushLimbaugh.com. It's from Business Insider, Henry Blodget.
"Here's The Only Chart You Need To See To Understand Why The US Is Screwed." You've seen the chart, Snerdley? This all from Saturday. "We're still working our way through Kleiner Perkins' partner Mary Meeker's excellent analysis of the financial condition of the United States. We'll be breaking out some key sections in the next few days. In the meantime, here's the one chart you need to see to understand why the US is screwed.
This is the 'income statement' of the United States in 2010. 'Revenue' is on the left. 'Expenses' are on the right. Note a few things... First, 'Revenue' is tiny relative to 'Expenses.'
Second, most of the expense is entitlement programs, not defense, education, or any of the other line items that most budget crusaders normally howl about. Third, as horrifying as these charts are, they don't even show the trends of these two pies: The 'expense' pie is growing like gangbusters, driven by the explosive growth of the entitlement programs that no one in government even has the balls to talk about. 'Revenue' is barely growing at all."
And what is obvious as well when you look at this is that there's no way to solely grow our way out of this. There's gonna have to be major spending cuts in entitlements.
So what I'm gonna do here, folks, I just turned the Dittocam off while I zoom in. I'm not gonna go through the process of having you watch me zoom in. But I'm gonna zoom in on this. All right. If you're watching on the Dittocam, here we go. As you're looking at this, the chart on the right is expenses.
The pie on the right is expenses. The pie on the left is income. Now, look at that pie on the right with the blue, orange, and red slices. Those are the entitlements: Medicare, Medicaid, Social Security. Expenses. The others are defense, education, a bunch of other stuff thrown in there.
The point being made is that the big pie is continuing to grow. These expenses are continuing to grow, grow, grow. The income on the left, pretty soon the comparison's gonna be the size of the earth to the moon, as it keeps going.
And they're right. You see this and it's all you need to see to illustrate the problem that we have and to be able to recognize that growth alone is not gonna equalize these two pies in size. It's going to require spending cuts.
Now, on the big pie, of those three, the blue, the orange, and the red, Social Security's 20%, Medicare is 22%, Medicaid, 22%, unemployment compensation, 16%. Social Security is 20%. Twenty-two percent is Medicare and Medicaid.
Unemployment compensation is -- this is striking -- three-fourths as big as Social Security. The amount of money we are paying people not to work as an entitlement on this chart, looked at as an entitlement, is three-fourths the size of Social Security. (interruption) Just like what? Just like Europe.
Just like Europe. On the income side, individual income tax rates are 41% of all income. Social Security tax, FICA, is 40%. Corporate income tax is 9%. There's 10% other varied sources of income.
So we'll link to that chart, and you'll be able to see it at RushLimbaugh.com.
“In 2008, 2009 and 2010 we still had the “full force of Bush tax cuts”. The fact is that tax cuts and spending increases are driving this country into the ground.”
Poor analysis!
Tax cuts ARE NOT driving this country into the ground!
In ‘08, ‘09, & ‘10, the problem was the manufactured real estate crisis and the onset of Obama’s anti-capitalist policies.
Congress threatened banks that didn’t want to participate in lending to unqualified borrowers. This Democrat scheme was repeatedly warned against, by the Bush administration and others.
Obama’s administration of TARP was nothing more than a government takeover of business and banks, so they could reward their union thug buddies.
Tax cuts do exactly as I stated in my previous post, they INCREASE federal revenue, as long as you don’t have a socialist like Obama imposing regulations and burdens on business, that drive cost and uncertainty.
Cut not only SS, but Medicare/Medicaid, and Defense spending. All of the other programs are chump change compared to the Big Three.
The country is BROKE. We dont have the money anymore for bloated government. It all has to be cut drastically.
I knew someone would mention that. Hopefully, keeping the government from borrowing at present levels and a serious effort by Congress to reduce the deficit will spur growth sufficient to generate revenues to make up the difference.
And if it doesn’t, cut more.
So do you think we are supporting millions of people at no cost? Many only see the cheap cost of labor with the illegals- problem is they can't survive on the cheap wages either so they are on every possible program- you really need to educate yourself about the real costs of illegals in this country. Illegals have overwhelmed our health care system, our educational system, and our judicial system. There are also many hidden costs involved in their use of many other city,county, state, and federal services that they use and do not pay for.
“I paid off every dime of my student loans. Took me 8 years and going to school every other year, but it got done.
Why should I have to pay because other people were fiscally irresponsible?”
In a true, non socialist Republic, you shouldn’t. I agree.
But we don’t. We live in an increasingly socialistic/communistic country. The reality is that with the current monetary system we have, the national debt IS “us having to pay because other people were fiscally irresponsible.” The way this system is set up, it allows a welfare state that ALL of us pay for. And the irresponsible aren’t just the welfare queens. No, the greatest irresponsibility is those who have set economic policy, the politicians, and the idiots called the FED.
I remember Freepers encouraging college students to “leverage” themselves with college debt, because they will have the better pay to pay it back. Right here on good ol’Free Republic. I don’t remember the handle of those doing so, but I still wonder and hope the Freepers asking the questions didn’t listen.
We need a reset, a default. Then our politicians, and those who don’t want to be productive, will have to figure out the hard facts of life, finally. Until then, yes, we do, and have been, paying for other people’s irresponsibility, for many years now.
I am truly sorry to hear what has happened to your daughter. If my daughter had been a few years older, it could have been us.
The university system is itself a ponzi scheme that will fall. It is just a matter of time. That student loans are not allowed to be discharged in bankruptcy is a true evil to do to such a young adults like her self.
I call it indentured servitude; it is slavery. It is evil.
We need to default on the National debt and destroy the FED.
It is their need for more and more credit that has encouraged all the corruption that is becoming apparent every day.
Like Maddoff said, “The government is a Ponzi scheme.”
He would know, wouldn’t he?
“We need a reset, a default.”
Great. I’m not paying for your loans unless you’re my wife. I already de-leveraged long ago. My whole family has, and is working on de-leveraging.
By the time we are finished, we’ll have a house free and clear and enough cars for everyone, all paid off and free and clear. We are getting there. 2 more cars and the house, and then we’ll be done.
“Then our politicians, and those who don’t want to be productive, will have to figure out the hard facts of life, finally.”
Not on the backs of the folks who de-leveraged you don’t. What am I to think if you push debt amnesty? I spent 4 years of my life working and waiting and saving because I wanted to avoid debt.
“Until then, yes, we do, and have been, paying for other people’s irresponsibility, for many years now.”
I have a choice, you can’t force me to pay a dime. Let’s make a deal here. You hire me and I’ll help you pay your loans off by making you money.
Or don’t hire me and leave me alone. Why are you making me pay for bills I never incurred and cannot afford to pay?
.
Cut 15 percent across the board and save 550 billion
Cut the Bush Tax cuts and save...........850 billion
1.5 trillion saved
Nobody forced her to take on the debt. She chose to take it on, and wants to escape the consequences of her decision.
Why doesn’t she find a man who’ll put up with her and pay them off? That would be more responsible then sending the bill to the state and to us.
I am in the same boat with you. We all are.
We own all our cars, and we are working to pay off the house. My daughter will NOT get ANY student loans, EVER. We are doing what we can to deleverage as well.
I only mentioned default. The whole country needs to default. The debt can NOT be repaid. It is a NATIONAL DEBT. We were both BORN with this system in place. That is what taxes are for. To pay the NATIONAL DEBT. The IRS has been making you pay and will continue to make you pay. I don’t want your money. You keep it, you are absolutely correct on that.
I am only pointing out the painful truth. It is not what any of us have planned for. We are not going to be able to grow out of this. Where are the jobs? Young people in debt BEFORE they can get a job? More and more people on welfare? With a coming housing implosion due to gas going up again? Case-Shiller starting to dip again? Does this sound like we are going to recover any time soon?
NO. I am sorry. Me and my hubby are stuck too. We have no chance of ever getting back a fraction of what we paid in. NEVER. I have made my peace with that.
Soon, when the dollar does crash, we all will.
Good, you are part of the solution not the problem.
“The whole country needs to default.”
The country has a spending problem not a production or an asset problem. Get the spending under control and the US will prosper. The US is only 2 years out from having 60 percent debt against the GDP.
In 2 years Obama has nearly doubled the debt. So we are in a crisis where spending must be reined in. The US is not in any danger of default, at present, but if spending persists even one more year at this rate, the debt will start to enter this territory.
Is it possible for a nation to deleverage to the point where they have managable debt? Yes. See Canada in 1993. Their debt was worse than the US is at present, but they managed to work it down by freezing spending. First the deficit was eliminated, and the debt shrunk.
“We are not going to be able to grow out of this.”
Hold the damn line and try the best we can. It *can* be done, and not only that, it *has* been done, and I refuse to believe that the greatest nation on earth does not have the collective will to get it done.
Sure it’s going to suck, especially the first few years. But that is what it is going to take. Get government the hell out of the way and watch the jobs come back.
Give it up. Increasing taxes does not save money. Only cutting spending saves money.
“You really believe there are no massive entitlements being given to illegals? You are very wrong.”
Nope. I’m right. You are wrong. The massive entitlements are Social Security and Medicare. Give me any credible number and we’ll compare that to the amount spent on Social Security and Medicare then I’ll tell you what “massive” means.
Go find any credible estimate of what we spend on illegals and I will post what we spend on Social Security and Medicare. We can compare the two numbers. Go ahead do it. I’ll be sitting on my rocker until you do.
I will not wait until you agree. We do not have that kind of time. At the present rate of deficit spending, we are going to go bankrupt as a country in three to six years of time. Our budget has to be balanced and balanced NOW. Those two charts that Rush talked about are only part of the story. The rest of the story is the rate at which we are accumulating debt, the difference between those two charts.
We cannot wait until all the spending we don’t like is cut from the budget. We have to also cut the spending we do like.
Frankly I think your thinking is too pervasive and I don’t think we will make it. That is why I am preparing to leave.
Federal revenue did not recover from the Bush tax cuts until 2005. In the meantime we ran up deficits that today we sorely wish we did not. I’m all for tax cuts. I’m all against tax cuts without spending cuts. Tax cuts do not increase revenue IN THE YEAR they are cut.
Thank you.
Sometimes I feel like Dave Ramsey on these threads. Someone calls in and says, “Oh I have all these expenses but I was laid off four months ago. I want to become a custom furniture maker and to do that, I’ll need a lot of tools, do you think I should charge them?” Then Dave says “No. You need to sell your house, sell your car and take your kids out of college and get a job, any job. Once you take care of your debts and have some cash THEN you can talk about investments.”
“So do you think we are supporting millions of people at no cost?”
Of course not.
What has overwhelmed our system is Social Security, Medicare, Medicaid and Defense spending. Just look at the charts. It’s as plain as day. Rush sees it an he is admittedly not good at math. It’s just simple arithmetic.
“Hold the damn line and try the best we can. It *can* be done, and not only that, it *has* been done, and I refuse to believe that the greatest nation on earth does not have the collective will to get it done.”
I pray to God that you are right. I’m not worried that the average Liberal doesn’t want to get rid of the deficit. I am very, very worried that the average Conservative doesn’t know or want to do what it takes.
As Ronald Reagan said, “If we lose freedom here, there is no place to escape to. This is the last stand on Earth.”
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