Ron Paul: The Truth Is That United States Is Broke

This is not pleasant reading to say at least. I have never…not for a second believed that the economy crisis was ever over. I actually wrote about this in 2009 and I have been updating the debt figures and also inserting new information along the way, but it is now November 2012 and what I said about what would be coming has now partly taken place. Even so, the economic crisis is far from over because It will get worse. Since this site is read by almost a hundred thousand each month I believe I owe my readers an update on the economic crises.

I know I wrote a couple of days ago as Obama won a second term, that the American auto industry was on it`s way back, but that was in context explaining the guidelines for the bailout money, and what Obama had done regarding that specific case.

This CPR they have been doing for quite a while now, will not help in the long run, because the “heart” has already have stopped. They want to keep this stupid system up and running for as long as possible. Now that seems to be more and more hard by the day. How long before people wake up saying: NO I don`t need another plastic Chinese phone made by poor children. No I don`t need to justify my existence and go to work just to live. No I will NOT support anymore devastation of the Planet we live on. And NO I will not support this system, where a few greedy owns everything of inheritance and forcing all other to work to make them richer. This Shit`s Gotta Go – Jacques Fresco

According to “the American hero” Ron Paul U.S. Is “Totally Broke. And the worst of it?  It can`t be fixed? U.S. Representative Ron Paul, a Texas Republican, talks about U.S. fiscal policy, and the prospects of political compromise on the nation’s budget deficit. Paul speaks to Betty Liu on Bloomberg Television’s “In the Loop.”

Ron Paul states, the truth is that we are broke. How do you compromise?  They only way you are going to compromise if you agree on what to cut.  Instead they’re trying to find out how they will agree on what they will protect.  I do not think I have heard the answer.  They talk about this fiscal cliff, but in my mind I work with the assumption we are already over the cliff, we’re just wondering how we’re going to land…it is unsolvable because you have to cut spending.

As long as they move in the direction of less government.  Maybe taking their oath of office seriously…That is long gone.  We’re so far gone.  We’re over the cliff.  We cannot get enough people in congress in the next 5-10 years who will do the wise things.  We have to prepare for having already fallen off the fiscal cliff. It is like what is going on in Greece.  Every day you hear of a solution and things pop up, but they are in debt and spend too much money and then the people go out in the street and demonstrate.  Romney was hit because one issue he was correct on, he was opposed the bailouts, and the people in the Midwest voted against him.  Oh, we have to be taken care of!

America is headed for a fiscal cliff at the end of this year. If Congress does not act, $1.2 trillion in automatic spending cuts will take effect as will a number of tax hikes. Many economists believe this so-called fiscal cliff could send the country back into it`s worst recession so far.

Not only Ron Paul makes this statement. Boston University economics professor Larry Kotlikoff also describes just how bad America’s finances are as a result of trillions of dollars in unfunded entitlement liabilities in his new book The Clash of Generations: Saving Ourselves, Our Kids, and Our Economy. He joined The Daily Ticker’s Aaron Task to discuss the nation’s indebtedness and his solutions for how to fix America’s ongoing fiscal crisis. He stresses the real seriousness of this problem. And the biggest problem in America today is not unemployment or slow economic growth but the unfunded liabilities like pensions, social security and medical care benefits that the government has promised to the citizens.

Laurence Kotikoff wrote in a recent column: “The 78 million-strong baby boom generation is starting to retire in droves. On average, each retiring boomer can expect to receive roughly $35,000, adjusted for inflation, in Social Security, Medicare, and Medicaid benefits. Multiply $35,000 by 78 million pairs of outstretched hands and you get close to $3 trillion per year in costs. This is not a partisan issue. The dirty little secret that neither President Obama nor Mitt Romney was telling you during election days was that our kids, who are being stuck with the bill, can’t afford it.”

Other than this, the US government already has an existing debt of around $15 trillion. Mitch Feierstein points out that the social security program of the US government is underfunded to the extent of $18.8 trillion. The underfunding in Medicare, the health insurance program, amounts to around $38.5 trillion. So if you add all of this up the number comes to greater than $75 trillion and that is what Feierstein feels the US government owes to other governments and its own citizens.

Mitch Feierstein, wrote in his book Ponzi Power – How Politicians and Bankers Stole Your Future, writes: “Using proper accounting methods…the true value of the state and municipal pension liability is at $5.2 trillion. When you deduct the $ 1.94trillion of pension assets that have already been set aside, you get a net liability of $3.26 trillion.” What do I feel? Well my reaction is get real, or go hang out with equally deluded supply-siders. U.S is broke and can no longer afford no- pain, all-gain “solutions.”

And as if this wasn’t enough! Forbes recently wrote about the Auto industry in America: President Obama is proud of his bailout of General Motors.  That’s good, because, if he wins a second term, he is probably going to have to bail GM out again.  The company is once again losing market share, and it seems unable to develop products that are truly competitive in the U.S. market. Right now, the federal government owns 500,000,000 shares of GM, or about 26% of the company.  It would need to get about $53.00/share for these to break even on the bailout, but the stock closed at only $20.21/share on Tuesday.  This left the government holding $10.1 billion worth of stock, and sitting on an unrealized loss of $16.4 billion.

More  More More

About these ads