The US $200-Trillion Debt Which Cannot Be Named

October 28, 2010 15:42

It turns out that the welfare state is a mathematical impossibility. Ludwig von Mises was correct. Those that practice socialism eventually bankrupt themselves.

From the Daily Bell

The scary real U.S. government debt … Boston University economist Laurence Kotlikoff says U.S. government debt is not $13.5-trillion (U.S.), which is 60 percent of current gross domestic product, as global investors and American taxpayers think, but rather 14-fold higher: $200-trillion – 840 per cent of current GDP. “Let’s get real,” Prof. Kotlikoff says. “The U.S. is bankrupt.”

“The U.S. fiscal gap is huge,” the IMF asserted in a June report. “Closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 percent of U.S. GDP.” This sum is equal to all current U.S. federal taxes combined. The consequences of the IMF’s fiscal fix, a doubling of federal taxes in perpetuity, would be appalling – and possibly worse than appalling. – Globe and Mail (Canada)

The 20th century as we have often noted was a true Dreamtime. People were convinced by the dominant social themes of the power elite that government was going to take care of them. As the century wound down the claims became more extravagant. Government workers especially won the right to stop working and collect pensions after only 20 or 25 years, and retirements became bigger and more gaudy as public sector unions pressed for more and more benefits.

Baby boomers (and European pensioners) who until recently looked at their balance sheets and believed that their financial goals had been achieved are starting to realize that much of what they counted on is increasingly ephemeral.

But in the 21st century, even the Western elites have not fared so well. The Internet has stripped them of their anonymity and revealed their promotional machinations. The economic crisis, which they intended to use to create a one-world government, has become a problem as well, causing people to turn to the Internet to see what has gone wrong. The education that takes place every day is eroding the elite’s hold on government, economics, military power and, most importantly, on the minds and psyches of the once easily-controlled masses.


tip from Monty Pelerin’s World

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