Thursday, July 17, 2008
If you opened your credit card statement and it said that you owe $455,000, you would be quite concerned, right?
If you got a letter from the IRS saying you owe $455,000, you'd be upset, right?
Well, I'm sorry to tell you, but you really do owe $455,000.
According to the Government Accounting Office, each American household owes $455,000. This is your share of the $53 trillion in long-term liabilities held by the U.S.
You may have heard that "deficits don't matter" or that these huge liabilities will be paid off during future boom economic times.
But listen to the words of non-partisan government experts on these issues:
- The St. Louis Federal Reserve Bank posted a paper entitled "Is The United States Bankrupt?". The paper provides the following answer: "The United States is going broke"
- "People seem to think the government has money," said former U.S. Comptroller General David Walker. "The government doesn't have any money"
- The United States Department of the Treasury and the Office of Management and Budget published a report stating that the U.S. cannot grow our way out of the government's liabilities, that the liabilities are quickly growing, and that failing to take drastic and immediate action would lead to very bad consequences (the report was written in 2006)
- The International Monetary Fund - which oversees third-world economies - are so concerned about the solvency of the U.S. economy that they are conducting a complete audit of the whole US financial system
The U.S. owes $53,000,000,000, and our rich lenders - China, Saudi Arabia, Dubai, etc. - are getting very tired of bailing us out. As Merrill Lynch recently pointed out, our "rich uncles" are seriously considering turning off the spigot on the U.S., to stop throwing good money after bad. The U.S. is already insolvent, but our government is hiding that fact from the average American. If our "rich uncles" cut us off and call in the debt, the U.S. may be forced to take drastic measures - like selling our physical assets to the lenders at fire-sale prices - just like debtors in bankruptcy court are forced to do every day.
Even if we can convince our creditors to keep lending us more money, the $455,000 each household owes will keep skyrocketing higher and higher. And as our government prints more and more greenbacks to try to bail out the big firms on Wall Street, we will all become serfs and wage slaves toiling away to pay off these debts and to buy the ever-increasing costs for necessities caused by run-away inflation.
You can thank both parties for this fine mess we're in. Presidents and Congress people from both parties have been selfish and ignorant about economics, and have been lulled into a "don't rock the boat" mentality by the snake oil salesmen representing the wealthiest.
There's Hope . . . If We Wake Up
There is hope. But it won't come from tinkering with the current financial system.
We need a new, transparent government and financial system which lives within its means. As people like Congressman Ron Paul have repeatedly pointed out, governments which use "fiat currencies" always spend more than they have and get in trouble.
This decades-long charade must end, and we must get back to sound economic policy. If America is to survive, we must wake up and start practicing true economics once again.