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Is Our Debt Burden Really $100 Trillion? (probably more - 'unfunded liabilities' are a KILLER)
The Atlantic ^ | 11/28/12 | Derek Thompson

Posted on 01/06/2013 1:26:02 PM PST by Libloather

Wanna scare somebody about America's debt on the eve of the Fiscal Cliff? I mean, really scare somebody? Here's a trick. Don't talk about the debt. Talk about "unfunded liabilities."

The U.S. national debt comes out to about $16 trillion today. That's something. But it's nothing compared to the extra $87 trillion in unfunded liabilities to Social Security, Medicare, and federal pensions. Here's how that works. If you add up all of the U.S. government's promises to pay retirement and health care benefits for the next 75 years and subtract the projected tax revenue dedicated to those programs over the next 75 years, there is a gap. A $87 trillion gap -- in addition to a $16 billion hole.

"Why haven't Americans heard about the titanic $86.8 trillion liability from these programs?" Chris Box and Bill Archer ask in the Wall Street Journal. The authors blame the U.S. government for using shoddy accounting and for misleading the American public on their finances. In fact, the most misleading thing about that $87 trillion is the way the figure is often used in the media.

(Excerpt) Read more at theatlantic.com ...


TOPICS: Crime/Corruption; Editorial; Government; News/Current Events
KEYWORDS: debt; liabilities; trillion; unfunded
Piece from November. Doesn't matter. The debt hasn't gone down. Just a few FR posts -

12/30/12 - Mort Zuckerman: Brace For an Avalanche of Unfunded Debt

11/27/12 - Oh, About Those Unfunded Liabilities

11/05/12 - Fiscal Cliff: Liability for unfunded liabilities equals $1,058,193 per taxpayer!

4/24/12 - Each U.S. Household’s Share of Unfunded Medicare And Social Security Liability Is Over $538K

4/24/12 - Social Security faces unfunded liability of $8.6 trillion; debt equals $73,167.83 per US household

2/16/12 - The State and Local Pension Crisis (Add these to the unfunded liabilities of the Federal Gov't)

6/07/11 - US Government Now Owes $61.6 TRILLION in Unfunded Mandates

3/18/11 - Gingrich Says He Doesn't Regret Supporting Medicare Drug Plan Which Is Now a $7.2 Trillion Unfunded

2/05/11 - 2010 Report to Congress on the Benefits and Costs of Federal Regulations and Unfunded Mandates

12/20/10 - $24.5 Trillion In US National Debt, $144 Trillion In Unfunded Liabilities In... 2015


1 posted on 01/06/2013 1:26:13 PM PST by Libloather
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To: Libloather

Repayment is a pipe dream. Insanity.


2 posted on 01/06/2013 1:32:34 PM PST by onyx (FREE REPUBLIC IS HERE TO STAY! DONATE MONTHLY! IF YOU WANT ON SARAH PALIN''S PING LIST, LET ME KNOW)
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To: Libloather

It’s gonna crash so hard.


3 posted on 01/06/2013 1:32:58 PM PST by ClearCase_guy (Nothing will change until after the war.)
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To: Libloather

Why don’t they tell us about these unfunded liabilities? Simple. They’re not real. You see, they are just promises to pay in the future. When push comes to shove the government can and will just wave a magic wand and these liabilities all go away. People will suffer but since when does big government care about that? Besides, what are they going to do, sue? Right.


4 posted on 01/06/2013 1:33:10 PM PST by pepsi_junkie (Who is John Galt?)
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To: pepsi_junkie

That’s called a Jubilee, and I am convinced that it is going to happen. Wave the magic wand and cancel all the debts. Tough medicine indeed — but there is no Plan B.


5 posted on 01/06/2013 1:34:56 PM PST by ClearCase_guy (Nothing will change until after the war.)
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To: onyx

Throw in the trillions of dollars that other countries owe the US.

Even if everybody were willing to settle for just getting the principle back, it will take 200 years to right itself.


6 posted on 01/06/2013 1:47:26 PM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: Libloather

This Ponzi scheme makes the Madoff scheme look like peanuts!

The question is “How fast and hard will it fall?”

I think the fact that the government is purchasing bulk ammunition and trying to take guns from the populace says it is close.


7 posted on 01/06/2013 1:53:56 PM PST by tired&retired
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To: ClearCase_guy

Even with a Jubilee the system collapses as the government can no longer give out money to freeloaders.


8 posted on 01/06/2013 2:00:51 PM PST by tired&retired
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To: tired&retired

I agree.

Truth be told, I think people around the world have been sold a bill of goods for several centuries — the USA was slow to adopt the erroneous idea, but we have now bought into it as well.

The idea is: National government can solve all problems. The nation-state is just as good as God. More government is better government.

I want the system to crash really, really hard. So that for 1000 years, anytime a politician rises up and tells a crowd, “I will give you things”, the crowd will immediately rise up and put his head on a pike.


9 posted on 01/06/2013 2:04:59 PM PST by ClearCase_guy (Nothing will change until after the war.)
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To: pepsi_junkie
Unfunded liabilities depend so much on demographic change, as well as the initial interest rate you want to set as a constant, they aren't worth worrying about.

They don't happen.

10 posted on 01/06/2013 2:15:37 PM PST by muawiyah
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To: Libloather

Make it more like $150 trillion.


11 posted on 01/06/2013 2:22:08 PM PST by Jack Hydrazine (It's the end of the world as we know it and I feel fine!)
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To: Libloather

There’s not enough money or assets in the world to pay this off. They’ve destroyed us—intentionally.


12 posted on 01/06/2013 2:29:32 PM PST by WKUHilltopper (And yet...we continue to tolerate this crap...)
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To: muawiyah
Unfunded liabilities depend so much on demographic change, as well as the initial interest rate you want to set as a constant, they aren't worth worrying about

That seems to me like saying "Since you don't know exactly how many cars are on the freight train speeding at you, it isn't worth worrying about"

From what I read, taking into account the variabilities, we're looking at between $80Trillion and $120Trillion, with the increase about $8Trillion a year.

The lowest of the numbers in that range is greater than the sum total of every privately-owned (including businesses and corporations) asset. The $8Trillion is larger than all income over $60k, plus all corporate income period, plus the entire DOD budget combined.


13 posted on 01/06/2013 2:31:16 PM PST by chrisser (Senseless legislation does nothing to solve senseless violence.)
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To: ClearCase_guy

Wanna know what’s scarier?

You’re starting to see a class of politician now who basically think the debt does not matter. Indeed, its a “good thing” because the debt creates jobs. Or, per Hilda Solis (Sec Labor) that the unemployment rate does not matter, because the unemployed “create millions of jobs”. And too many Americans are so dumb or co-opted that they can’t see the issue.

Up is down. Day is night. Slavery is freedom.


14 posted on 01/06/2013 2:32:38 PM PST by rbg81
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To: ClearCase_guy

That’s called a Jubilee, and I am convinced that it is going to happen. Wave the magic wand and cancel all the debts. Tough medicine indeed — but there is no Plan B.


The only problem with that Plan is that the day after not much is different. You are still spending at a deficit and you still need to borrow $$ from someone. But who will lend after you just screwed all the other lenders?


15 posted on 01/06/2013 2:37:02 PM PST by rbg81
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To: tired&retired

I think you are very astute. :)


16 posted on 01/06/2013 2:41:35 PM PST by Jonty30 (What Islam and secularism have in common is that they are both death cults.)
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To: Libloather

Yes, our future unfunded promises are impossibly huge. This is made even more egregious because government is borrowing to fund present spending with no intention of ever repaying. The net result is that we have allowed ourselves to be placed in permanent servitude to service this debt.

The land of the free has sold themselves into serfdom.

The only reservation I have to the claims about the size of the future unfunded debt is that they don’t net out that debt by any income or payments, however small they may be.

This particularly applies to unfunded future obligations of Social Security, a program that receives the FICA wage tax.


17 posted on 01/06/2013 2:42:19 PM PST by theBuckwheat
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To: rbg81

You see it, but you do not see it.

After the Jubilee, everything IS different. Sure, the politicians want to borrow more money, they want to make more promises, and they want to bribe people some more.

But they CAN’T.

Because they just screwed all the lenders. So now it’s “cash on the barrel head” for anything a politician might want to do and in the midst of a crash and the aftermath of the crash, the government is absolutely powerless to do much or to make promises.

You want Limited Government?? That’s pretty darn limited — because everyone will know that the government is good for nothing.


18 posted on 01/06/2013 2:58:29 PM PST by ClearCase_guy (Nothing will change until after the war.)
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To: ClearCase_guy

Honestly, I don’t think it will happen like that. Indeed it can’t happen like that because the Government (including the Federal Reserve) owns the printing press. They can continue to print dollars to “meet” their obligations, but those dollars will be worth increasingly less.

Or will they? The farce will keep going for quite some time because, as the author states, ALL the Central Banks are playing the same game: they are buying their own bonds with $$ created out of thin air. But since they are all doing it, the risks are lessened. They are doing it for one reason: to stave off social upheaval.

— For the West (including Japan): Too much debt, too many promises, and too high a standard of living. Aside from Germany and Japan, there is not enough industry to provide a living for everyone. So the Government has a bigger and bigger role in employment and entitlements keep the rest of the population fed & docile. They play along because if there will be massive social upheaval if Government spending is actually cut to sustainable levels.
— For the East (particularly China): They need to grow, so they need to export. They play along because the alternative is massive unemployment and, likewise, social upheaval. Also, even while its Monopoly $$, it helps them catch up with the West from a military/technological standpoint.
— For the Oil Producers: They are in the same boat. The minute the petrol dollars stop, they will have to contend with their own restive populations

So, really, everyone has almost no choice but to play along.


19 posted on 01/06/2013 3:07:54 PM PST by rbg81
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To: chrisser
What i was saying is that if you sit down and piddle around with present value analyses you can come up with all sorts of startling things.

It's rather like saying that if great great grandpa had deposited $10 in the bank in 1830 you'd be a millionaire today ~ but you're not a millionaire.

Actuaries do a bit better. Plus, some investment analysts have been sufficiently well versed in technological change they've successfully anticipated DEFLATION and negative interest rates over time.

20 posted on 01/06/2013 3:12:37 PM PST by muawiyah
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To: theBuckwheat
Current payment on the national debt is in the neighborhood of $38 billion per year. That's an impossibly large number on an individual scale ~ but quite small compared to the debt being carried, and very small compared to the value of the assets held by the US government.

Check it out, how much is invested in each carrier group? That's an asset. We have most of the world's carrier groups, and everybody knows they can be taken out by nukes BUT most of the nations we encounter in an adversarial roll don't have nukes.

We have other forces buried in the ground to deal with the other nuclear powers. At some point we will have incredible robotic machines that will deal sternly with all enemies and while we sleep soundly in our homes they will exterminate nations who threaten us.

21 posted on 01/06/2013 3:18:09 PM PST by muawiyah
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To: Libloather

It’s $222 Trillion:

http://hotair.com/archives/2012/08/09/great-news-the-us-fiscal-gap-just-jumped-11-trillion-to-222-trillion/


22 posted on 01/06/2013 3:38:01 PM PST by 4Liberty (Some on our "Roads & Bridges" head to the beach. Others head to their offices, farms, libraries....)
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To: Libloather

“He has erected a multitude of New Offices, and sent hither swarms of Officers to harass our people and eat out their substance.”- John Hancock ,Declaration of Independence.


23 posted on 01/06/2013 4:06:36 PM PST by TurboZamboni (Looting the future to bribe the present)
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The recent insanity (and, by some, serious consideration) of the ‘Trillion Dollar Coin’ is proof positive that a good number of people will believe anything, no matter how absurd.


24 posted on 01/06/2013 5:25:45 PM PST by IncPen (Read the Constitution.)
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To: Libloather

No legislative body may be bound by a previous legislative body, We have ZERO DEBT and ZERO OBLIGATIONS, it can be changed at the whim of Congress, they just keep going along with the same scam every year.


25 posted on 01/06/2013 6:27:15 PM PST by eyeamok
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To: Libloather
My Dad took a pretty big "haircut",pension-wise,a few years before he died.The *private* company he worked for,once a major one,was driven out of business by a new technology.And then,his haircut! If he could take one *every single* government paycheck recipient (except active and retired members of the Armed Forces) can take a big one as well.

Filthy Communist parasites!

26 posted on 01/06/2013 6:29:10 PM PST by Gay State Conservative (When Robbing Peter To Pay Paul,One Can Always Count On Paul's Cooperation)
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To: Libloather

Why do liberals always say that Iraq and Afghanistan are unfunded? We paid for those already haven’t we?


27 posted on 01/07/2013 7:31:50 AM PST by napscoordinator (GOP Candidate 2020 - "Bloomberg 2020 - We vote for whatever crap the GOP puts in front of us.")
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