From a newsletter in today’s email. Now you know why I’m depressed…
The problem with socialism is that eventually you run out of other people's money
Margaret Thatcher
Maybe I should stop reading…
The federal government posted its largest monthly deficit in history in February… $223 billion. The Congressional Budget Office estimates the 2011 deficit will reach $1.5 trillion (we're up to $642 billion for the first five months of fiscal 2011). And today, the Senate will vote on competing spending cut proposals.
Surely, the proposed cuts will cover at least one month of the government's deficit… It takes sacrifice to make up a $1.5 trillion deficit. Well… Democrats already rejected GOP-backed cuts of more than $50 billion, and Republicans rejected the Democrats' cuts of less than $10 billion. Let's say, when Congress is all done, the cuts total $30 billion… That's less than one-seventh the February deficit. That wouldn't even cover one month's interest payment on outstanding U.S. government debt. (The government has spent $101 billion on interest through the end of February.)
If not by cost-cutting, how will the government make up the deficit? Taxes? If we doubled today's tax revenue, we'd still have a deficit. Half of U.S. citizens pay zero taxes. The half that pays would leave if you double its taxes.
What about cash reserves? Well, we don't have any to speak of. The government spent $81.6 billion of its reserves in the first four days of March. We're left with a paltry $108.9 billion (or five days' reserves if we continue spending at this rate).
Everybody knows the answer is inflation. I hate to say that, because when everybody is sure of something, it tends to be well accounted for in the market price of the relevant assets. Gold is way up. Silver is way up. Sounds like the whole world already agrees with us. Printing money is the easiest way for the government to steal from its citizens without their knowledge, while devaluing its debt at the same time.
This is a really serious problem. Yet most of us are oblivious.
As of March 1, 2011, the official debt of the United States government is $14.2 trillion ($14,172,957,589,857).[1] This amounts to:
• $45,860 for every person living in the U.S.[2]
• $120,582 for every household in the U.S.[3]
• $301,455 for every U.S. household that pays more in federal taxes than they receive in benefits from the federal government[4]
A record one in seven Americans relied on government food stamps to help feed themselves in 2010, according to the latest data from the US Department of Agriculture (USDA).
Current data indicates it’s getting closer to 1 in 5.
World Socialist. What is happening to me? I’m really over the edge if I use the World Socialist for data…
Government payouts—including Social Security, Medicare and unemployment insurance—make up more than a third of total wages and salaries of the U.S. population, a record figure that will only increase if action isn’t taken before the majority of Baby Boomers enter retirement.
Even as the economy has recovered, social welfare benefits make up 35 percent of wages and salaries this year, up from 21 percent in 2000 and 10 percent in 1960, according to TrimTabs Investment Research using Bureau of Economic Analysis data.
“The U.S. economy has become alarmingly dependent on government stimulus,” said Madeline Schnapp, director of Macroeconomic Research at TrimTabs, in a note to clients. “Consumption supported by wages and salaries is a much stronger foundation for economic growth than consumption based on social welfare benefits.”
First WSWS and now CNBC?
Lot’s of other interesting graphical data here http://i.imgur.com/zMaff.jpg (Thanks Gary)
SOOO in the end, I can just get back to work and watch some mindless Jenn Aniston. Do they really think that this will be viral in the Wake of Charlie Sheen…
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You are not entitled to your opinion. You are entitled to your informed opinion. No one is entitled to be ignorant.
Harlan Ellison