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Last week I challenged readers to provide links to the best arguments on both sides of the idea that we are doomed because of the soaring national debt. I have reviewed your comments and your links and render my nonpartisan verdict.
  •  If the government hadn't bailed out banks, we might already be toast.

  • When baby boomers retire in numbers, we're doomed for sure.

  • Stimulus money will largely be wasted.

  • It is possible to grow the economy enough to minimize a very large debt, and this has been done in the past. But the past has never seen a debt as large as the one ahead of us, when the boomers start collecting Social Security and their health costs skyrocket. And we're not done with mortgage defaults either.

  • If the government tries to inflate our way out of the debt, or raise taxes by some huge amount to pay it down, the medicine will be as deadly as the disease. In other words, we're in a fiscal death spiral.

  • No one credible is showing any numbers that give us a way out of the death spiral. Or at least none of you provided a link to anyone who sounded credible to me.
  • My blog sofware will never allow me to do properly formatted bullet points.

And so I conclude, based on the evidence presented in the comments to this blog that the most realistic straight line prediction is that we're all doomed. And that seems to be the case no matter what any president did in the past or will do in the future.

The good news is that straight line predictions are almost always wrong. The future unfolds in shocks and surprises. So maybe our civilization will be annihilated by space invaders before inflation ever becomes a problem. Or maybe some inventor is on the verge of building a device that turns industrial waste into delicious, non-fattening food.

I've already predicted that the next economic boom (okay, bubble) will involve energy storage devices. And I think another growth area will be new planned cities to store all the senior citizens. The notion of a "house" will change into something much less expensive and yet more fun and useful.

 
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Mar 17, 2011
Debt ManagementPlans & IVA's are two choices that people in debt have at their disposal
<a href"http://getoutofdebtfast.org.uk "rel"dofollow">Get Out of Debt Fast</a>
 
 
Sep 13, 2009
I have the solution for the economic problems of the US government:

1. Make immigration legal again. Anyone who isn't a criminal, and doesn't have a communicable disease should be able to move to the US, provided they agree to permanently forgo any "entitlements".

2. Sell off all government-owned property and use the proceeds to buy people out of their future entitlements, voluntarily. People would have the option of getting a refund of part of their previously-paid social security and/or medicare taxes if they agree to permanently forgo any "entitlements".

3. Repeal all government regulations of business. Separate government and the economy, just as government and religion are separate.

4. Stop all "entitlements" for anyone under 30 years of age, and cut promised benefits to those of us between the ages of 30 and 60, on a sliding scale, so that 60-year-olds get 90% of what they would have received on retirement.

5. Cut government down to its core responsibilities: protecting lives and property.

6. Cut taxes by 50%. Since a core government only needs about 20% of present revenues, the other 30% can be used to phase out "entitlement" programs, as described above.

7. Eliminate the Federal Reserve and separate the creation of money from government, just as religion and government are kept separate.

Within 5 years I predict the US economy will have grown 40%, which, along with the "entitlement" cuts, will eliminate the US government's present insolvency.
 
 
0 Rank Up Rank Down
Sep 2, 2009
OK, So I'm going to stock up on guns and seed and retire up bush somewhere. Grow my own vegies and shoot Roo's for meat.

I'm fixed, good luck to the rest of you.
 
 
Sep 1, 2009
Some of the problems of America are self contradictory.

The total net present value of future benefits depends on the interest rates assumed. If interest rates go up, the net present value goes down.

The global warming problem collides with the peak oil problem. Since the Arctic ice cap is melting, we will soon have access to vast areas of sedimentary basins, some of which are known to have hydrocarbons.

Social Security depends on workers paying in money for benefits. Should the percentage of people in the work force fall as the population ages, they will make more money and pay more benefits. This is actually what caused the Social Security trust fund problem in the first place when we brought in so many lower earning immigrants to lower wages of the people who actually pay most of their taxes in the Social Security tax brackets.

In 1949 both Germany and Japan settled their Social Security problem by lowering the marginal rate of income taxes and hugely increasing wealth taxes.
Worked fine. The German GDP doubled every five years for twenty years after they confiscated half the wealth of the country by mortgaging all the property. In Japan, they mortgaged from 10 to 90 percent of the property depending on the amount of property controlled by each individual, and the Japanese GDP doubled every five years for twenty five years.
This isn't easy to find out about because high school and college history books are bought by people who have more property than most and they tend to be somewhat reluctant to specify purchase of books that make them nervous.
 
 
Sep 1, 2009
If you're really into this, you should read Plan B 2.0 (it's a book, not the birth control). It's an economic, social, and environmental plan that is both plausible and makes sense. My ultra-liberal World Relations teacher swears by it, and I'm starting to follow in his footsteps. Except it also has a plan for reducing the carbon footprint, and I don't believe in global warming, so that part seems superfluous...
 
 
+1 Rank Up Rank Down
Sep 1, 2009
All civilisations come to an end. Romans, Greeks and British empires all came and went.

It looks like to US empire will simply implode trying to maintain the lifestyles of its ever aging population. Obviously this will have a drastic impact on the rest of the West, but not cataclysmic.

Once the impending US collapse become more apparent Europe will cut ties and invest in China, accelerating it’s elevation to the new world leader.

So a couple of thousand years ago Rome was the centre to the civilised world. Couple of hundred years ago it was Britain. For the last 100 or so it’s been the US. Time for China to take its turn.
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The British Empire never went away. The UK is still one of the most influential countries in the world, even after it's Empire collapsed (even though it lost its colonies, Britain is better off without the colonial/mercantilist trade system) and two world wars pushed it to the very limits of desperation. As for Greece and Rome; Greece was never united fully, except sometimes temporarily, and Rome had a slavery based economy that required constant military expansion due to low birthrates amongst slaves. Once the Roman Empire couldn't easily expand further and the slave population within the Empire declined, the whole house of cards came tumbling down.

The problems that the US faces today are not problems that haven't been faced by several other countries in history. Financial collapse? Nothing compared to Japan's collapse in the early 90's. War? Please, nothing even close to WW1 and 2. Too much debt? Once again, Japan, France, and the USA circa 1943 all have us beat there.
 
 
+1 Rank Up Rank Down
Sep 1, 2009
Bank bailouts are not part of the national debt. They are done by the FDIC which operates off bank fees.

If you meant the bank stimulus payouts, they are to be paid back. Which several banks have already paid back. The government forced them to take the stimulus money even if they didn't need it, so it was easy for some to pay back.

Only think that ticked me off with this whole mess was the US gov bailing out companies that have more employees outside the USA than in...Like GM.
 
 
+2 Rank Up Rank Down
Sep 1, 2009
Bad News: My pending invention that turns industrial waste into delicious, non-fattening food isn't working out...so far it just results in a low-fat yogurt that causes radioactive poisening in rats. (I call them Yog-Hurtz).

Good news: My new planned citiy to store all the senior citizens is coming along nicely. It's called "New Miami" (Its basically the same as Old Miami, but we will serve lots and lots of Yog-Hurtz!)
 
 
Sep 1, 2009
All civilisations come to an end. Romans, Greeks and British empires all came and went.

It looks like to US empire will simply implode trying to maintain the lifestyles of its ever aging population. Obviously this will have a drastic impact on the rest of the West, but not cataclysmic.

Once the impending US collapse become more apparent Europe will cut ties and invest in China, accelerating it’s elevation to the new world leader.

So a couple of thousand years ago Rome was the centre to the civilised world. Couple of hundred years ago it was Britain. For the last 100 or so it’s been the US. Time for China to take its turn.
 
 
+1 Rank Up Rank Down
Aug 31, 2009
I was wrong and right in the same post.

Just use a dash then

- point 1
- point 2
- point 3

witty comment
 
 
0 Rank Up Rank Down
Aug 31, 2009
• If you just use ASCII text codes you can do the bullet points manually
• I know this doesn't fix the problem but it's a way to work around it
The ASCII code for bullet points is #0149 which means you hold down the ALT key and type 0149 and a bullet point will appear.

I'm slightly worried that it won't look the same as what I typed above once it gets posted, and I'll end up looking like a complete fool. Therefore the names have changed to protect the innocent.
 
 
Aug 31, 2009
Massive debt Too many old people = Logan's Run Soylent Green
 
 
Aug 31, 2009
We could make the other 97 per hundred persons that live on earth as well as US citizens cleverer This would stimulate the global economy

here is a video about how giving perinatal persons a sip of a probiotic causes their GI tract to make more DHA a lipid shown to raise IQ 20 points or higher http://www.youtube.com/watch?v=sS9b5eKu-0s Goo Goo IQ Goo

If everyone on earth is cleverer they might produce a 20 pt more which translates as the generation of an entire new 14 trillion US sized economy of useful things

plus as these are people worldwide the materials from this materialism are spread to those that place a higher value on them

Note that a new person starts being economically productive near 20 yet the Treasury paper is on 30 thus the lifting stimulus from the cleverer people is meaningful to the current projective thing
 
 
Aug 31, 2009
How has the bank bail outs helped our economy. How.
 
 
Aug 31, 2009
The President of the Dallas Federal Reserve, Richard W. Fisher said that the real US national debt is close to $100 trillion! Bottom line we're screwed.

http://www.dallasfed.org/news/speeches/fisher/2008/fs080528.cfm
 
 
-1 Rank Up Rank Down
Aug 31, 2009
Chris Martenson's "Crash Course" is a good look at where the economy is going and how the debt relates to war-times. http://www.chrismartenson.com/crashcourse

As for your bullet point formatting issue - if too much spacing is the problem, look into using Ctrl Enter or Shift Enter to get the desired spacing without creating a new bullet point.
 
 
+2 Rank Up Rank Down
Aug 31, 2009
I suspect in the long run, most of our seniors will be stored in boxes buried six feet below ground.
 
 
Aug 31, 2009
* If the government tries to inflate our way out of the debt, or raise taxes by some huge amount to pay it down, the medicine will be as deadly as the disease. In other words, we're in a fiscal death spiral.

* No one credible is showing any numbers that give us a way out of the death spiral. Or at least none of you provided a link to anyone who sounded credible to me.

And you're OK with "none of you provided a link to anyone who sounded credible to me" providing a link to "we're in a fiscal death spiral."
 
 
Aug 31, 2009
Scott, I'm glad to see you are finally beginning to understand the mess that we're in. As they say, denial is not a river in Egypt. Yet many of our fellow citizens (if not most) seem to think that everything will just get better by itself without any tough action. Or even worse, that our kind, benevolent, paternalistic government will cradle us in its arms and make all the bad stuff go away.

Here's an interesting web site that every reader of this blog should check out. It's beyond sobering: http://www.usdebtclock.org/index.html

Some things in particular to note:

- Unfunded liabilities (UL) for Social Security, Medicare and the Prescription Drug program now sit (and remember, the Baby Boomers are just starting to retire) at $59 trillion. The National Debt currently stands at a tad under $12 trillion, and the Obama administration has said that's going to go up by another $9 trillion in the next 10 years. That puts the total debt UL at about $71 trillion, and that's before Obama-care.

- Each citizen's share of the debt UL (that's each live American citizen, whether they're two days or 100 years old) stands at roughly $262,000. The US median HOUSEHOLD income is about $50,000. So figure, again roughly, that every working household would have to contribute five and one-quarter year's income, over and above their tax burden, to erase that debt.

- US government spending year-to-date is $2.6 trillion while tax revenues stand at $1.3 trillion. As you can see, the debt is not stabilizing.

Once a person gets on the dole, it's next to impossible to get them off. It's like a drug - you know it's bad for you, but you just can't help yourself. Once you're hooked, you're hooked. Roughly 30% of retirees live solely on Social Security income - can you imagine telling them, "Sorry, we're all out of bucks, so good luck."

Government has made promises it can't keep. What is needed is bold action by our elected representatives to admit the problem and get us out of it. We literally can't continue this way, yet most of our politicians of both parties seem hell-bent on digging us deeper and deeper into debt, making more and more promises they know they can't keep, hoping that when it hits the fan, they'll already be dead.

Partisan politics aside, we need to look for solutions to this problem. But look what happens when the people protest this rampant government spending? They get called everything from racists to Nazis.

We all need to admit how in extremis we are. We need to hold our politicians accountable, and not allow them to blow smoke up our butts. Then we need to look for strategies to transition the current entitlements to a sustainable level. There are some innovative ideas out there that we can all weigh in on. Newt Gingrich's American Solutions is one such forum. Another example is found in Charles Murray's book "In Our Hands," where he proposes a plan to replace the Welfare State that actually has an interesting perspective.

But what we can't do is do nothing. Individuals must contact their representatives and senators and demand that they focus on the out-of-control spending, oppose additional massive spending programs, provide actual stimulus (not special-interest paybacks) to the economy, and change the very course of government.

Right now, they're not listening to us. Our federal government is running away with plans to serve themselves, not the people. They aren't listening to us. It's time to put aside partisanship and focus on the problem government now poses to our nation. It's all up to us, folks.

In the sixties, there was a saying: "If you're not part of the solution, you're part of the problem." That is particularly apt now. Every one of us needs to decide on which side of that equation we sit.
 
 
Aug 31, 2009
If we are doomed, we are doomed. We as citizens have elected those representative we felt could best deal with our economic and social well-being. Let's hope it turns out well.


What I don't like are the kinds of people that say "It's the Apocalypse! We're all going to die very soon any way", and then avoid living their life for that reason. They don't invest in their futures at all, monetarily or otherwise. If it isn't the end, I would rather be prepared to enjoy my life.

-Josh
www.theohnozone.com
 
 
 
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