Debt will bring us down
January 10, 2013
Congress has not saved us from a financial cliff they have merely dodged a small pot hole. Their actions are tantamount to trying to drain the swamp with an eyedropper.
In our economy the government is allowing us to live way beyond our means by continually adding debt upon debt. We can live well and beyond our means only until the point is reached where we can no longer support that debt.
The lions share, some 86 percent, of the government’s income is from taxes. They can only tax the American people 100 percent of their income. Reaching the point where the government can no longer meet the payments on the national debt will result, to say the least, in a sudden and severe collapse in the American way of life. This is the real economic cliff that looms ahead of us. Raising the tax rate on a small portion of taxpayers and promising to look at expenditure reductions along with an increase in the debt ceiling as a solution to avoiding the economic cliff is ludicrous.
If, in 2009, the federal government spent all federal revenue on paying down the debt, that is no spending on anything other than the debt, there would have still been a remaining debt in excess of $10.2 trillion. If the government had taken all 100 percent of our country’s disposable personal income and spent it on nothing but the national debt there would have been a remaining $1.8 trillion debt. If there had been a run on redeeming just the publicly held, this includes foreign held, portion of the debt in 2009 it would have taken 74 percent of all this countries personnel disposable income with nothing for other government expenditures and still left the remaining federally held debt of $4.3 trillion. The increases in the debt for 2010 through 2012 have made the situation even more dire.
Congress continually passing an increase in the debt ceiling is a clear indication that they fully intend to continue increasing the national debt. Their failure to implement a true budget, one that does not ignore more than 50 percent of known expenditures also serves to indicate their aim. Further, continued failure to adhere to even their bogus budget attests to their political pandering to moneyed and individual interests.
Unless our political system greatly changes, addresses our real problems, and we commit to lowering our personal interests as well as adopting an all inclusive austere standard of living to work our way out of this deep, deep hole, we are destined to collapse as have all other formerly great societies.