Saturday, March 31, 2012

America: Debt Man Walking

Just how broke is America? We are currently spending about $3.8 trillion on tax revenues of about 2.3 trillion. The debt is over $15 trillion and climbing. Bush and the Republicans exploded the national debt in 8 years by $5 trillion. Obama has already increased the debt by another $5 trillion and counting in about 3 years. No effort is being made to rein in spending. The government believes that it can literally spend its way out of national bankruptcy and economic ruin.

Think about the cuts that would be required to live within our means ($2.3 trillion in tax receipts). Well, the federal government doesn’t actually have $2.3 million to spend because Social Security receipts fly right out the window in benefits.

The interest on the national debt in 2011 was a staggering $454 billion, according to the Treasury's own website, here. How does $454 billion relate to government revenues? Of the $2.3 billion in 2011 federal revenues, $1.3 billion came from income taxes, $800 billion came from Social Security taxes (money that is supposed to be untouchable and not spent by Congress but the Social Security Trust Fund is routinely plundered) and another $200 billion in miscellaneous revenues, The only money the government really had to spend was $1.5 trillion and most of that was earmarked for other massive entitlements, here.

$454 billion is a mind blowing 30% of federal tax receipts, excluding SS taxes, and the cost of interest on the $15 trillion and growing debt will only continue to rise as the government continues to run $1 trillion to $1.5 trillion in deficits.

The White House budget reported that $780 billion was disbursed to SS recipients in 2011. USA Today reported that Medicare and Medicaid totaled a staggering $992 billion in 2011 ($554 billion for Medicare and $438 billion for Medicaid), here. At least 58% of the American people are dependent on government funded healthcare. There are other big entitlement programs like housing, food stamps and unemployment, to name a few.

Americans think the federal government is the cornucopia of plenty, just one big piñata that rains free healthcare, free food, free education, free housing, free money to buy things and well, free everything. The Greeks thought the same thing until their piñata started raining nothing but defaulted bonds and profound economic misery.

How much longer can the American entitlement state last? How much longer can the empire and its wars last? The welfare-warfare state is busting apart at the seams.

Americans are living in a twilight zone and remain totally clueless.  

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