Posted on 08/02/2010 4:02:01 PM PDT by justsaynomore
“Our economy is on a government-induced lose-lose trajectory of financial destruction between federal spending and tax revenue. It’s a Mathematically Assured Depression (MAD). The only unanswered question is when.”
- Herman Cain, March 9, 2009 commentary
I do not enjoy bad news predictions. But the president, his administration, Congress and the major mainstream broadcast media are focused on everything except the coming financial disaster we face. It’s not that the other issues are not critical. The financial crisis could be catastrophic.
The Congressional Budget Office (CBO) issued another warning last week that the growing federal debt is unsustainable! It is a real crisis! As stated in the CBO report, “A growing level of federal debt would increase the probability of a sudden fiscal collapse”.
This did not just start under the Obama Administration, but it has clearly accelerated during this administration. Consider the following statistics:
When President Obama took office in January 2009, the national debt was $9.5 trillion, which is nearly $32,000 for every man, woman and child living in this country. The national debt as of this writing is nearly $14 trillion, which is $45,000 for every man, woman and child living in this country. That’s a historic increase in a historic short period of time!
That debt does not die when we die. Our children and grandchildren will have to pay our foreign creditors back, if we can avoid a total financial collapse.
As the president and Congress continue to spend like crazy, they continue to pay lip service to wanting to get spending under control. Their words do not match their actions.
For example, Senate Democrats tried to pass a $30 billion “drop in the bucket” package to help stimulate lending to small businesses. Over $600 billion of the stimulus bill has not worked, so the Democrats wanted to throw another $30 billion on top of the $846 billion stimulus spending. The majority of Republicans voted against it because it was new spending, when the money could have been taken out of unspent stimulus funding.
Of course, the president blamed the Republicans for being partisan obstructionists.
The anticipated December 2010 report by the Debt Commission appointed by the president will be nothing more than so-called justification to raise taxes even more than they will automatically increase on January 1, 2011 if Congress does absolutely nothing. Whether or not only the “rich” gets hit remains to be seen.
The CBO report and analyses by other organizations, such as The Heritage Foundation, indicate that the administration and Congress are playing “sudden death” with our economy, which has huge national security implications.
The notion that raising taxes will solve the problem is misguided and factually false based on sound historical analysis. And the belief that this economy will not slow down even further with tax increases is equally misguided.
Admittedly, this is not an inspiring or entertaining topic. In fact, it is downright scary. It is even scarier that a large number of voters are equally oblivious and blind to this clear and present financial danger. What happened in Greece and other European countries can happen here.
The big difference is that Uncle Sam does not have a “sugar daddy” to bail us out.
The 2010 congressional elections are sudden death for control of the House of Representatives. If real Republicans take control, there is some real hope of slowing down the destruction of our economy.
This is a serious crisis, and the elected so-called leaders are not listening. I believe the voters are listening. They will remember in November.
***Pinganator***
And this is a surprise to whom?
The debt is not a problem.
The fed will sell some of the stocks it has purchased to run up the market, and purchase the treasury debt. What could go possibly go wrong?
Increasingly, the only solution will be for the US government to renounce the national debt. While this will cause some short term chaos, it is the quickest way out of this morass. And, the alternatives to doing this are both extended and extremely destructive.
Other nations have done this, for better or worse, and proven that it is a better and faster way to recovery. In America’s case, it will require that we rebuild our infrastructure and industry, and that our economic system again become reality-based, instead of relying on debt, speculation that is just gambling writ large, and endless credit to the unworthy.
No one seems too concerned about the blackmail factor.
China: We’ll continue to buy your junk debt, so long as
you look the other way on ....
Before the US renounces the debt, look for Obama and the Dems to make significant cuts in the armed forces, gutting our defense structure to the point we will never afford to rebuild it.
If it comes to this, then it is the Cloward-Piven moment when the left siezes control, tears up the Constitution (in favor of a new, more 'enlightened' one) and the United States falls into a massive depression and civil war that will leave us vulnerable to the combined military of China and Russia.
That’s a little melodramatic. They wouldn’t bother to invade us there are plenty of closer more vulnerable targets. If we collapse we’re out of danger even assuming the country collapsed completely we still have the nuclear shield and the atlantic and pacific. Its everyone within marching distance of those two countries who are in trouble.
There IS in fact a rational way out, but it would involve jettisoning our present money and banking system which is based on debt and fractional reserve banking, along with the income tax which was never in fact meant to do anything other than pay interest on a debt which was perpetually rolled over.
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