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Monday, June 27, 2011

USA: The world's most indebted country

USA: The world's most indebted country
by The Debt We Owe.com
The Southern Times/Southern Africa
27-06-2011

There is a lot of talk about the national debt of the United States these days, but the truth is that most Americans still do not really grasp how horrific it really is.

Today, the US national debt is rapidly approaching US$14 trillion.

It is the single biggest debt in the history of the world. It has grown in size for a whopping 53 years in a row, and every single month it gets even worse.

Things were bad enough before the economic crisis of 2008, but since then US government debt has soared into the stratosphere.

We are now running deficits that are well over a trillion dollars each year with no end in sight. We are literally running out of people to borrow money from.

China is still the largest foreign holder of US government debt, and we have to constantly keep sending top government officials over there to beg them to keep lending us money.

But they are getting tired of our nonsense.

Now the Federal Reserve is saying that they probably will just buy up
massive amounts of US government debt.

That is essentially a gigantic Ponzi scheme, but the truth is that there is not much about US government finances that does not resemble a Ponzi scheme at this point.

In a recent article in which Boston University economics professor Laurence J. Kotlikoff analyzed the financial condition of the US government, he summarized the situation by making the following statement:

'Let's get real. The US is bankrupt.'

After analyzing Congressional Budget Office data, Kotlikoff
concluded that the US government is facing a 'fiscal gap' of
US$202 trillion.

That number includes our current debt and unfunded future
liabilities that the US government has already committed to.

What a complete and total mess.

So what can the US government do about this situation? Raise
our taxes through the roof?

Oh yeah, the American people are really going to go for that
about now.

Well, perhaps we could sell some US government assets. After all, don't we have a whole bunch of gold sitting in Fort Knox?

The truth is that nobody knows for sure what is in Fort Knox because there has not been an accounting of it in years, but assuming the gold is still there, perhaps we could sell it.

So how far would it go?

Well, according to one estimate, there is 147 million ounces of gold in Fort Knox. It would be worth approximately US$176 billion at today's prices.

That would cover the US government budget deficit for about a month or two.

The sad reality is that we are literally drowning in debt, and
we are going to pass this enormous debt on to our children
and grandchildren.

Do you think that they will thank us?

What we are doing to future generations is absolutely unconscionable.

But hey, now you can help.

If you would like to help address this problem, the federal
government is actually taking online donations that will go
towards paying off the national debt.

Try to resist the urge to laugh.

Seriously, though, the horror that this nation is facing is beyond comprehension.

The following are 12 statistics about the national debt of the United States that are almost too crazy to believe....

1. From the founding of the United States until Ronald Reagan took office, the United States had accumulated a total debt of about US$1 trillion.

2. In just the last 30 years we have accumulated US$12 trillion dollars more debt.

3. If you were alive when Christ was born and you spent US$1m
every single day since that point, you still would not have spent
US$1 trillion by now.

4. If right this moment you went out and started spending one dollar every single second, it would take you more than 31 000 years to spend US$1 trillion.

But somehow the US government has accumulated a debt that is
well over US$13 trillion.

5. It is projected that the US government will issue nearly as much
new debt in 2010 as the rest of the governments of the world combined.

6. If you do the math, the truth is that it is simply not possible to pay off the US national debt.

In fact, if you took every single dollar out of every single bank and out of every single wallet in the United States there still wouldn't be anywhere close to enough money to do it.

7. According to an official U.S. government report rapidly growing
interest costs on the US national debt together with spending on
major entitlement programs such as Social Security and Medicare
will absorb approximately 92 US cents of every dollar of Federal
Revenue by the year 2019.

That is before one penny is spent on anything else.

8. Back in 1950, each retiree's Social Security benefit was paid for
by approximately 16 workers. Today, each retiree's Social Security
benefit is paid for by approximately 3.3 workers. By 2025 it is
projected that there will be approximately two workers for each
retiree.

9. According to the Congressional Budget Office, in 2010 the Social Security system will pay out more in benefits than it receives in payroll taxes.

That was not supposed to happen until at least 2016.

10. Over 41 million Americans are now enrolled in the food stamp
program and the US Department of Agriculture is projecting that
more than 43 million Americans will be on food stamps by the end
of 2011.

11. A trillion US$10 bills, if they were taped end to end, would wrap around the globe more than 380 times.

That amount of money would still not be enough to pay off the US national debt.

12. According to Democrat Erskine Bowles if some truly significant changes are not made, the US government will be spending US$2 trillion just for interest on the national debt by the year 2020.

Considering the fact that the total budget for the US government in 2010 was less than US$4 trillion, that is a very troubling prognosis.

Anyone with half a brain can see that this is not anywhere close to sustainable.

Anyone with half a brain can see that this is destined to end very badly.

Anyone with half a brain can see that we are headed for absolute financial disaster.

We have been living far, far beyond our means for decades, and
now a day of reckoning is fast approaching.

As a society we have been completely addicted to debt, and now
we are going to pay the price.

Is there any way out of this mess? Not under the current system.

The cold, hard truth is that the US government is headed for a debt nightmare that is going to shake the financial system of the entire world.

For years, many of us tried desperately to warn the American people that we were headed for disaster, but most people did not listen.

In fact, most Americans still do not understand how horrific this financial crisis really is.

Unfortunately most Americans will probably not wake up until a
complete and total economic collapse happens, and by then it
will be too late. - thedebtweowe.com

http://www.southerntimesafrica.com/article.phptitle=USA:
%20The%20world's%20most%20indebted%20country&id=6082

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