October 30, 2006

Will America go bankrupt? GAO Chief Warns Economic Disaster Looms

As a nation we are $40,000,000,000,000 in debt (not $8T as the government would have you believe) and growing.

We cook our books and do not report future liabilities on our official balance sheet. Social security and medicaid/medicare if not radically altered will cause the US to default on its loans or print money into hyperinflation. The US media is too lazy to report on this timebomb. And our elected politicians only care about the next election and not the next generation.

And Americans could seemingly care less, and won't care until the sh*t really hits the fan, which by then will be too late.

Here's an update though from the independent general accounting office's comptroller general. I've watched a couple of speeches from this guy, and my take is that he must have the most frustrating job in the world, knowing what he knows and not getting anyone to listen. He must go home at night, kiss his wife, kids and gold bars, and then resume work on the bunker.

GAO Chief Takes to Road, Warns Economic Disaster Looms Even As Many Candidates Avoid Issue

David M. Walker sure talks like he's running for office. "This is about the future of our country, our kids and grandkids," the comptroller general of the United States warns a packed hall at Austin's historic Driskill Hotel. "We the people have to rise up to make sure things get changed."

Walker doesn't want to make balancing the federal government's books sexy -- he just wants to make it politically palatable. He has committed to touring the nation through the 2008 elections, talking to anybody who will listen about the fiscal black hole Washington has dug itself, the "demographic tsunami" that will come when the baby boom generation begins retiring and the recklessness of borrowing money from foreign lenders to pay for the operation of the U.S. government.

Their basic message is this: If the United States government conducts business as usual over the next few decades, a national debt that is already $8.5 trillion could reach $46 trillion or more, adjusted for inflation. That's almost as much as the total net worth of every person in America -- Bill Gates, Warren Buffett and those Google guys included.

A hole that big could paralyze the U.S. economy; according to some projections, just the interest payments on a debt that big would be as much as all the taxes the government collects today.

46 comments:

Alan P. said...

The sheeple don't care, they just want their house price to go up more.

Anonymous said...

All they care about is a fridge full of Bud Light and 300 channels on cable.

Anonymous said...

Yeah 300 channels but nothin' ever good is on....

Anonymous said...

Keith, you just have to look to Italy and Japan to see what young people will do - work jobs that are off the books so they don't have to pay into the pension schemes. Illegal laboring is the life, for me. Live with their parents rather than buy into insane housing. And the US debt can go up a LOT before it reaches Italy/Japan levels of debt-GDP-ratio. US is currently at 40% debt/GDP. Japan is at 140% I believe.

Anonymous said...

Through all the different postwar eras, federal tax receipts have been locked at 18-21% of GDP. Tax RATES have gone up and down, but tax receipts have not. Any projection of increasing tax receipts ignores history - Americans won't pay more than 21% of GDP without a world war on.

Metroplexual said...

I read this today. I am glad this guy finally woke up.

fish said...

Pitchforks and Torches.....Pitchforks and Torches.....!!

Anonymous said...

who knows what will happen? money is nothing. it all depends of if we have services available.

Disgorge! said...

China is teetering on the verge of a bad-loan-led collapse. From Bloomberg: More bad debts will accumulate and gradually be recognized as such until the banks start to run out of capital. Then we will have our first post-IPO Chinese banking crisis. My guess is it will take about five years from now. It takes time for bad loans to be recognized.

FlyingMonkeyWarrior said...

Can you say Stagflation?

Anonymous said...

i thought bruce sang about 500 channles

panicearly said...

David Walker video lecture from 2005.

http://tinyurl.com/yhmkjy

tabasco jenkins said...

"Can you say Stagflation? "

Yep, and I've been seeing it for 6 years now, too.

The only way out is for the govt to inflate its way out of the debt. Make those $1000/mo social security checks you're gonna receive at retirement practically worthless.

Either that, or convince voters to support cuts in social security and medicare. Fat chance that'll happen, so inflation it'll just have to be.

Of course, the govt could just be fiscally responsible, and pay as they go, but where's the fun in that, and it'd probably just be too little, too late, anyways.

Anonymous said...

Vice president have said that deficit does not matter.

Anonymous said...

40 trillion in paper can be printed up at will.

Richard said...

1970 style stagflation with attitude

got gold... check

got off grid bunker... check

got gun... check

got food... check

got water... check

Anonymous said...

social security in 2008 and medicare in 2011. who's going to pay them if the young hardworking illegals are deported?

Anonymous said...

Richard, check out and rent "The Omega Man". That's gonna be you.

foobeca said...

And the US debt can go up a LOT before it reaches Italy/Japan levels of debt-GDP-ratio. US is currently at 40% debt/GDP. Japan is at 140% I believe.

The US debt ratio is A LOT higher than 40%. The official national debt is $8T and some change. The GDP is about $12.5T. But the govt. doesn't account for future liabilities. Add in those and you're in a $50-70T problem that only gets worse by the day.

Our true debt/GDP ratio is at least 500%.

Anonymous said...

Hardwoking illegals are paid under the table stupid and do not pay into the system. But when they have an anchor baby, you get to pay for the hospitalization, the food stamps, and the 12 years of school.Illegal Mexican's are not cheap labor, they actually cost more then they are worth.

Richard said...

Hey ANON watch Soylent Green -

You be like the old guy gets to see a movie of forests and wildlife
just before being euthanized, watching in rapture as tears begin
streaming down his face.

Better wake the FuK up...no better yet - don't - one more round I can save.

Anonymous said...

social security in 2008 and medicare in 2011. who's going to pay them if the young hardworking illegals are deported?

-------------------------

They're not paying them now, amigo.

Anonymous said...

Hardwoking illegals are paid under the table stupid and do not pay into the system. But when they have an anchor baby, you get to pay for the hospitalization, the food stamps, and the 12 years of school.Illegal Mexican's are not cheap labor, they actually cost more then they are worth.

---------------------

Exactly. But the greedy unprincipled bastards who hire them get to pass those costs on to the rest of society...

Anonymous said...

In one of his speeches, Greenscam said that the Fed can guarantee that the money will be there, but not the purchasing power of that money. In other words, he was hinting that the government will likely print its way out of that $40 trillion debt. Doing something responsible like increasing the starting age for public retirement benefits (Social Security and Medicare) would not be politically popular, so resources will be rationed by inflation. The benefits will be such a pittance that most "retirees" will have to keep working just to pay for basics like $20/gallon milk and $10/loaf bread.

In fact, this process is already underway. Inflation is routinely understated, so the COLAs for Social Security fall short of the true rate of inflation. Benefits are effectively cut a little each year.

Obviously, gold and silver are preferable to fiat currencies in this scenario. Oh, and Europe and Japan have retirement "age wave" problems that are at least as bad as those of the US, and, in many cases, worse. On the other hand, some of those countries have not totally dismantled their industrial base, at least not yet. It's hard to say who's in worse shape.

Anonymous said...

"Greenscam"
+++++++++++
Just wanted to say how much I love that nickname. It fits perfectly. I'm gonna use it from now on.

Anonymous said...

RICHARD,

GETIN FIESTY. ME LIKEY.

-MAHA

Anonymous said...

"Greenscam"
+++++++++++
Just wanted to say how much I love that nickname. It fits perfectly. I'm gonna use it from now on.

--------------------

I'm glad to see I did some good today.

Anonymous said...

"Will America go bankrupt? GAO Chief Warns Economic Disaster Looms"

Read this fast, before it is deleted. Honest answers don't last long on this blog.

Yes, America will go bankrupt and cease to exist. Will America's insane rulers bring their country down in a nuclear holocaust? Or will America be taken over by its enemies after it has been totally destroyed by the ravages of hyper-inflation, revolution, poverty, disease and famine?

Assuming the latter scenario, will Americans who hoarded gold and silver have a better chance of survival? What new language will former Americans be forced to learn? What currency will replace the dollar? What new religion will replace Christianity?

Something to think about, isn't it?

hyman69 said...

don't you all see that the white man is toast. quit worrying about a shitty ole house. a single man or woman will make it . it will be those with families that will have a rough time.this has been in the works to destroy the common man in the usa for many years.nikta kruschoff said fifty years ago ( I WILL DESTROY YOU FROM WITHIN)it is coming to pass.

47james said...

fifteen years ago, if you would have told a frenchman that their would no longer be a french frank, or a german person no longer a german mark, they would have told you that your crazy. soon their will be no us dollar, no canadien dollar, and no mexican peso.all three of these currencies will be combined as one and called the ? also their will be open borders with these three countries, with free flow of people and goods. (new world order)god help us.

Anonymous said...

"fifteen years ago, if you would have told a frenchman that their would no longer be a french frank, or a german person no longer a german mark, they would have told you that your crazy. soon their will be no us dollar, no canadien dollar, and no mexican peso.all three of these currencies will be combined as one and called the ?"

Oooh, A New Currency Naming Contest!

Let's see, we can call it hmmm....



the quatloo (Star Trek)
the wetback (oh, mebad)
the Wal-Mark (Always Devalued Prices)
the microsoft
the yuannabe
el loonio peso americano
the dimebag
the greenscam

Anonymous said...

Somebody was saying it could be called "the Amero". I forget who.

Disgorge! said...

Some crazies posting here.

:-(

Anonymous said...

"i thought bruce sang about 500 channles"

Mark, not Bruce..

FlyingMonkeyWarrior said...

CAFTA, NAFTA, AMERO, North American Super Highway Connecting Canada, US and Mexico, Border check point in Kansas City, Imigration Problem solved.

Anonymous said...

>> (From the article:) The federal government actually produced a surplus for a few years during the 1990s, thanks to a booming economy and fiscal restraint imposed by laws that were passed early in the decade.

Lou Dobbs had a short segment about this a few weeks ago. A new study just completed concluded that this is a lie - there WAS NO SURPLUS. F'n, lie'n Clintons...

>> Or will America be taken over by its enemies after it has been totally destroyed by the ravages of hyper-inflation, revolution, poverty, disease and famine?

That's probably why W signed a bill on Oct. 17 allowing him to declare Martial Law for any reason. How come THAT wasn't on the nightly news? Where does it say in the Constitution that the Constitution can be suspended?

honica jewinski said...

In regards to greenscam, I prefer greeny the sheeny

Anonymous said...

I'd like to know how you are ging to spend your gold and silver when the fiat system crashes? The fed has already reinstated the 1930's gold laws and can seize your shit on a whim. Plus if they ban all purchasing, trading, or buying of metals when said time comes then what? Sell/trade on the black market and end up in a hole somewhere? If you think Gitmo is bad now what about when the shit REALLY hits the fan?

Anonymous said...

Maybe you should get, like, a formal EDUCATION in economics before you keep making a jackass out of yourself.

A debt, and a projected shortfall, are not the same thing.

Anonymous said...

Anonymous said...
Hardwoking illegals are paid under the table stupid and do not pay into the system. But when they have an anchor baby, you get to pay for the hospitalization, the food stamps, and the 12 years of school.Illegal Mexican's are not cheap labor, they actually cost more then they are worth.
=============================

Yep. And let's not to forget the costs of crime, policing them, prison, public defenders, and their health care, and their dental care, and their rent subsidies. Illegals in Los Angeles now get subsidized, tax payer funded auto insurance, too.

And politicians get what they want: Tens of millions of socialist voters with low IQs.

honica jewinski said...

I'm thinking ammunition may end up being the new currency. Especially if these criminal mexican invaders keep flooding in.

Anonymous said...

Lou Dobbs had a short segment about this a few weeks ago. A new study just completed concluded that this is a lie - there WAS NO SURPLUS. F'n, lie'n Clintons...
==================================
Well Lou Dobbs is one to point the finger. Lou was one of the big proponents of the "New Economy" (which the US Govt based their surplus forecast on)and one of the biggest media shills for Wall Street. Once the 2001 New Economy stock market collapse hit, then CNN and Lou Dobbs turned from being cheerleaders of this fraud and reinvented a "populist" version of Lou Dobbs. A Lou Dobbs who comes on CNN every night to rant and rave about ENRON, Illegal aliens and job losses suffered by the blue collar middle class. But he's a faker.
There never was any surplus, and once Alan Greenspan could no longer pump ficticious money into the NASDAQ internet bubble, under the guise of the fraudulant Y2K scare, then the trillions of dollars in market cap came tumbling to the ground. And thats where your surplus went.
Now Greenspans giant real estate bubble is in full blown collapse. This should be worse than anything any living American has seen in their lifetime.

Anonymous said...

Let's just keep this ponzi scheme going for another 40 - 50 years. I got no kids so I could care less after that.

Anonymous said...

I say invest in wheelbarrows~~
He is nuts you say:.
You see the feds will turn on
the printing machines and inflate
the money supply and we will have
hyper-inflation,and only wheelbarrows will have any value,
because the currency will lose its
value so fast everyone will need a
wheelbarrow to cart their money
to the store to buy a damm loaf
of bread.~`~it will be history
repeating itself.....

Anonymous said...

Postscript...Im working on a deal to purchase 99 billion wheelbarrows
from Dick Cheney and co.

GK said...

Civil War and GDP per Capita relationship:

As GDP per person goes down, chance of civil war goes up exponentially.

http://tinyurl.com/yds83r

http://www.unmillenniumproject.org/documents/figure_1.gif