Le site Bellaciao: coloré, multiple, ou le meilleur cotoie fort heureusement le pire, mélangé, bizarre, picabien et dadaîste, explorant toutes sortes de registres et de régimes rhétoriques, drole et polémiqueur, surréaliste: rencontre d'un parapluie et d'une machine à coudre sur une table de dissection, têtes de Lénine sur le clavier d'un piano Steinway ou Bosendorfer...
FR
ES
Senal en Vivo
VIDEO
RADIO
FRIENDS SITES
with Bellaciao
Bellaciao hosted by
To rebel is right, to disobey is a duty, to act is necessary !
Bellaciao  mobile version   |   Home  |   About us   |   Donation  |   Links  |   Contact  |   Search
Is The USA Bankrupt?

by : Bill Bonner, Editor
Wednesday July 19, 2006 - 06:02
6 comments

http://www.freemarketnews.com/Analy...

Is The USA Bankrupt? Bill Bonner, Editor: The Daily Reckoning Tuesday, July 18, 2006

Is the United States of America, asks Laurence J. Kotlikoff, professor of economics at Boston University, "at the end of its resources, exhausted, stripped bare, destitute, bereft, wanting in property, or wrecked in consequence of failure to pay its creditors?"

Or, abandoning the Oxford English Dictionary for Ray Charles, are Americans "busted, broke...no bread...I mean like nuthin’?"

Answering his own question in the affirmative, Professor Kotlikoff explains: "This partial equilibrium analysis strongly suggests that the U.S. government is, indeed, bankrupt, insofar as it will be unable to pay its creditors, who, in this context, are current and future generations to whom it has explicitly or implicitly promised future net payments of various kinds."

We don’t know what a partial equilibrium analysis is. But since it supports our general view, we ask no questions. Instead, we merely probe more deeply into the report for elaboration and amusement.

"Unless the United State moves quickly to fundamentally change and restrain its fiscal behavior," Kotlikoff continues, "bankruptcy will become a foregone conclusion."

This does not particularly help us. We have no doubt that the nation will be bankrupt. What caught our eye was the assertion that it is already broke. But that, it turns out, depends on what you mean by the word ’broke.’

"The proper way to consider a country’s solvency," goes on the professor, "is to examine the life-time fiscal burdens facing current and future generations. If these burdens exceed the resources of those generations, get close to doing so, or simply get so high as to preclude their full collection, the country’s policy will be unsustainable and can constitute or lead to national bankruptcy.

"Does the United States fit this bill? No one knows for sure, but there are strong reasons to believe the United States may be going broke."

Among the strongest reasons is a study of the total net "fiscal gap" that the country faces. This is the present value of the difference between the government’s future income and expenses - calculated using optimistic assumptions and not including any contingent liabilities, such as those that rise with the water level in New Orleans, or with insurgent activity in Iraq. No, these are the basics: interest payments, government operations, social security, and drug money. The figure, as negative and depressing as our Daily Reckonings occasionally are, is $65.9 trillion - or about 500% of the nation’s GDP.

We have reported this number before, more in mischief than despair. Somehow, that gap has to be closed. Otherwise, the feds will have to stop sending out checks. But what do we care; the government already sends out too many checks to too many people, in our opinion. Then again, we don’t depend on Social Security or have a safe full of T-bonds.

Besides, there is no chance that the gap will be closed, anyway. Kotlikoff has a sense of humor on this point. He notes that the government would have to cut discretionary expenses by 143%. Or, personal and corporate income taxes could be doubled. Just in case the reader missed the joke, he includes a chart that tells us that people at the upper end of the income scale already pay more than 50% of their incomes in taxes.

Now, a question: Which country do you think expanded its health care benefits most over the 32 year period - 1970 to 2002? Sweden, Japan or the United States? You probably can guess - America, the land of the free stuff. In fact, in the U.S. public health care benefits grew twice as fast as in Sweden during that period, which is a big part of the reason the United States is going broke.

With a problem this big staring them in the face, you might think the custodians of the nation’s financial health would be staying up late at night trying to come up with solutions. If you thought that, you would be an idiot. It is late in the cycle, dear reader. Patriots can no longer save the republic; it no longer exists. Instead, they spend their time trying to get what they can out of a decaying empire. Paul O’Neill was the first U.S. Treasury secretary to bother to calculate the "fiscal gap." George W. Bush fired him for it and proceeded to sign every spending bill - no matter how preposterous - to come his way. For its part, Congress continues to add to the fiscal gap every day it is in session, which leads Kotlikoff to conclude:

"The most likely scenario is that the government will start printing money to pay its bills. This could lead to spiraling expectations of higher inflation, with the process eventuating in hyperinflation."

This is not the only reason to buy gold, dear reader, but it is one of them.

• Meanwhile, as goes the U.S. government...so go its citizens and taxpayers. From Business Week July 12, 2006:

"The U.S. Labor Dept.’s job report on July 7 showed that retailers had shed 7,000 jobs in June, after a loss of 71,000 jobs in the previous two months combined (see BusinessWeek.com, 6/9/06, "Behind The Retail Jobs Numbers").

"Strange Trend. It’s unusual that retailers are trimming their workforces when the rest of the economy is growing. For years, retailers have been the source of significant job creation in the U.S. During the 1990s, department stores, groceries, and other retailers added 2.3 million jobs, or an average of almost 20,000 a month, according to the Bureau of Labor Statistics.

"Now, the concern is that retailers, who are positioned to detect the pulse of consumers more quickly than many other types of companies, are sensing trouble ahead. ’Something is screamingly wrong with consumers, and retailers are reacting,’ says Richard Hastings, economic advisor to the Federation of Credit and Financial Professionals and a senior retail analyst at Bernard Sands, a retail credit rating firm."

What is screamingly wrong is the Great Dollar Paradox of the early 21st century is that Americans have too few dollars and foreigners have too many. Global prices increase - gold is back near $670. Gold may be getting ahead of itself, but it shows clearly what direction it wants to go. Oil is setting new records. Nickel has gone up 50% in the last month.

Meanwhile, domestic U.S. prices slump (see below).

This puts the United States in a bind. When it wants to go to war with someone - or offer free drugs to old people - it has to borrow the dollars from the people who have them: foreigners. If we remember the figure correctly, 75% of all new U.S. government borrowing this century has been financed from overseas.

Back at home, Americans are running out of money. The homebuilding stocks are falling apart. So, believe it or not, is that middle-class shopping mecca, Wal-Mart.

Rich Americans are still building houses in Greenwich and Palm Beach. They’re still buying art at auction and adding to their positions in hedge funds. But the middle and lower classes are having a hard time making ends meet. They are forced to use their few dollars to buy the most expensive gasoline they ever saw. Those dollars get out their passports, breeze through the metal detectors (there is no metal in them), and leave home. They go overseas, take up residence in one of the oil or trinket-exporting nations, and get ready for their next move.

No wonder the home folks are feeling a little lonely. "Consumer morale dips," says a Reuters headline. Yes, it dips because people don’t have enough dollars to consume with. Many of them haven’t had a real pay increase since 1973. They need dollars to help make ends meet. And now, with rising energy prices and resetting mortgages, those footloose, fancy-free, globe-trotting dollars are sorely missed. Foreclosures are up 26% in the Dallas area. June retails sales were off nationwide.

• You can still exchange your paper money for the real thing. The U.S. government is selling gold - in the form of a pure Buffalo coin. The price of the metal will probably correct before going much higher. But with civil war at hand in Iraq, regular old-fashioned war in Israel, brand new war on terrorism worldwide, a few buffalos and bankruptcy ahead for the world’s only remaining superpower...a few buffalos might give you a comfortable feeling.

• "Did you know that there have been big improvements in working with genes?" said Henry at the dinner table last night. "Now, they can implant genes from one species to another...and the gene will be fully expressed."

"What does that mean?" his father wondered.

"Oh, I know," said Elizabeth, quick on the up-take, "they can take a gene from Eric Clapton and put it in a new variety of corn...so it will have a good ear for music. Or how about getting a gene from Warren Buffett and putting it in lettuce so the new strain will have a good head for figures?"

"Very funny, Mom," said Henry.

But what happens if you accidentally put a gene from lettuce into Warren Buffet?



Leave a comment
Print this article


Commentaires de l'article
 

> Is The USA Bankrupt?
Wednesday July 19 - 08:50 - Posted by 9f37aa8a60206526...

I guess this explains Dick’s portfolio. He’s betting that the dollar will collaps and interest rates go thru the roof. and i got to believe dickie boy has the inside track on this shit too.




> Is The USA Bankrupt?
Wednesday July 19 - 13:59 - Posted by 475e4114dab3209a...

It’s bankrupt in both matters financial and moral.




> Is The USA Bankrupt?
Wednesday July 19 - 19:23 - Posted by 38c3ef28b89c1928...

NO Problem, we’ll just press a button and print more money... Easy it’s just paper anyway. It’s not backed by anything.

Saddam Hussein wanted to sell oil in Euro’s. Look what happened to him.
John Kennedy wanted to go back to the gold standard. Look what happend to him.

But all the gold in the basements of the Twin towers was removed 2 days before the controlled demolitions of 911.




> Is The USA Bankrupt?
Wednesday July 19 - 20:43 - Posted by 0c62a07826a8b89e...

I think we should be buying paper companies now. Bcoz dollar manufacturing business will need lots of that raw material :)



> Is The USA Bankrupt?
Thursday July 20 - 03:09 - Posted by 041cabb2dfd2f0eb...

If the Fed keeps on rasing rates like they did in 1981 then
Gold will crash.
If there is a downward drift in rates accompanied by real inflation then Gold will soar.
If there is a big change in government, maybe they will tackle the fiscal problems
and push Gold down.




> Is The USA Bankrupt?
Thursday July 20 - 23:00 - Posted by cca6e2af4a39cb78...

No. It is being kept bankrupt. Have any of yoy heard of Leo Wanta? He is trying to recover 27 TRILLION dollars that belongs to us, but the Fed is blocking his efforts!
For more info see:
http://www.arcticbeacon.com/15-Apr-...
http://www.arcticbeacon.com/20-July...
http://www.rense.com/general72/fedd.htm







Public Apology to Women of the World from The American Republic (Hypatia of Alex
Monday 31 - 15:21
by Willam Morgan
YES, THERE WILL BE ELECTION FRAUD, AND ON A GRAND SCALE
Sunday 23 - 18:32
by JOHN CHUCKMAN
Hillary Clinton will be first female President 2017
Monday 10 - 17:21
by Willam Morgan
Police Shootings: Law, Policy, and Accountability
Thursday 6 - 14:22
by William John Cox
AMERICA DESERVES BETTER, BUT EVEN MORE IMPORTANTLY, THE WORLD DESERVES BETTER
Thursday 29 - 18:02
by JOHN CHUCKMAN
Back to School for Fascist Dupont-Aignan
Thursday 15 - 11:32
by Nouveau Comité de Vigilance des Intellectuels Antifascistes
The Presidency: Character Matters
Friday 9 - 15:06
by William John Cox
WHY HILLARY IS THE PERFECT PERSON TO SECURE OBAMA’S LEGACY
Tuesday 30 - 18:08
by JOHN CHUCKMAN
Remake of Ben Hur in 2020 planned by new motion picture studio
Friday 26 - 15:50
by Wallace
THE CASE FOR DONALD TRUMP
Monday 22 - 19:32
by JOHN CHUCKMAN
THE CONSTITUTION OF THE UNITED STATES IS DEAD
Thursday 11 - 06:42
by David R. Hoffman, Legal Editor of Pravda.Ru
DONALD TRUMP AND THE GENIUS OF IDIOCY
Friday 5 - 00:47
by David R. Hoffman, Legal Editor of Pravda.Ru
FOOLING MOST OF THE PEOPLE MOST OF THE TIME IS WHAT AMERICAN POLITICS ARE ABOUT,
Friday 29 - 18:13
by JOHN CHUCKMAN
A message of your fellow striking workers from France
Tuesday 12 - 20:49
by Info’Com-CGT
The Right to Vote, Effectively
Friday 8 - 22:20
by William John Cox
Fourth of July Lies
Sunday 3 - 19:41
by June C. Terpstra
Who Should Make Political Policy, the People or the Politicians?
Friday 24 - 15:14
by William John Cox
Hollow Women of the Hegemon Part II: Atrocity Enabling Harpies
Tuesday 21 - 18:49
by Dr. June Terpstra
The American Republic Manifestum book is being made into a Movie
Saturday 11 - 15:54
by William Morgan
Write-in Voting and Political Protest
Wednesday 1 - 15:05
by William John Cox
Yves Bouvier art battle plays out in online and social media arena
Tuesday 31 - 21:12
by Dean Bagley
Damaged Candidate Clinton Can’t Call Out Trump
Friday 27 - 13:53
by Daniel Patrick Welch
PLEDGE OF THE NEW REPUBLICAN PARTY
Tuesday 24 - 21:53
by David R. Hoffman, Legal Editor of Pravda.Ru
LET TEXAS SECEDE
Thursday 19 - 00:53
by David R. Hoffman, Legal Editor of Pravda.Ru
LAS TRES ERRES A LA ENÉSIMA POTENCIA.-
Monday 16 - 15:35
by FREDDY SUBDIAGA
DEMAGOGIA POPULISTA...
Monday 16 - 15:26
by FREDDY SUBDIAGA
Oligarchs Won’t Let You Vote Their Wars Away
Wednesday 11 - 20:24
by Daniel Patrick Welch
AN AMERICAN ORIGINAL: JOHN KERRY - FROM HIS REMARKABLE RECENT COMMENCEMENT ADDR
Monday 9 - 20:40
by JOHN CHUCKMAN
Donald Trump and Hillary Clinton support the American Republic Manifestum
Monday 9 - 16:37
by William Morgan
Transformation: A Student-Led Mass Political Movement
Monday 25 - 19:28
by William John Cox
Algerian Feminists react to ’Hijab Day’ in Paris 2016
Monday 25 - 01:13
THE ILLUSION OF RIGHTS
Friday 22 - 18:45
by JOHN CHUCKMAN
US is real superpredator pretending to be victim
Monday 18 - 22:23
by Daniel Patrick Welch
Gaiacomm International has accidently created a fusion reaction/ignition.
Sunday 17 - 17:01
by William Morgan
Clinton’s Campaign Continues to Highlight Horrible Hillary
Saturday 9 - 00:57
by Daniel Patrick Welch
Armoiries racistes à Harvard : Plaidoyer pour la réflexion socio-historique
Thursday 7 - 18:56
by Samuel Beaudoin Guzzo
THANK YOU MISSISSIPPI FOR YOUR HATE
Wednesday 6 - 02:02
by David R. Hoffman, Legal Editor of Pravda.Ru
The PKK in Iraq: “We are ready to fight ISIS everywhere in the world”
Monday 4 - 14:33
by InfoAut
Clinton Crashes and Burns, Sanders Will Win (But hold off on the applause)
Friday 1 - 22:33
by Daniel Patrick Welch
Confirming Supreme Court Justices and Electing Presidents
Friday 1 - 20:59
by William John Cox

home | webmaster



Follow-up of the site's activity
RSS Bellaciao En


rss FR / rss IT / rss ES



Bellaciao hosted by DRI

It is the responsibility of the intellectual to speak the truth and to expose lies. Noam Chomsky
Facebook Twitter Google+
DAZIBAO
I, European citizen, won’t let refugees be rejected in my name
Thursday 10 March
©Olivier Jobard/Myop I, European citizen, won’t let refugees be rejected in my name THE RIGHT TO ASYLUM IS A RIGHT In the phrase « right to asylum », every word matters. Under the law, every person who is persecuted because of his or her political opinions or because of his or her identity, every person that is endangered by violence, war or misery has a RIGHT to seek asylum in another country The aim of this petition is to collect (...)
read more...
Neo-Nazis and far-right protesters in Ukraine 3 live-stream
Friday 24 January
2 comments
The far-right in Ukraine are acting as the vanguard of a protest movement that is being reported as pro-democracy. The situation on the ground is not as simple as pro-EU and trade versus pro-Putin and Russian hegemony in the region. When US Senator John McCain dined with Ukraine’s opposition leaders in December, he shared a table and later a stage with the leader of the extreme far-right Svoboda party Oleh Tyahnybok. This is Oleh Tyahnybok, he has claimed a "Moscow-Jewish mafia" (...)
read more...
Hugo Chavez is dead (video live)
Wednesday 6 March
by : Collective BELLACIAO
1 comment
President Hugo Chavez companeros venezueliano died after a long battle with cancer.
read more...
International initiative to stop the war in Syria Yes to democracy, no to foreign intervention!
Thursday 13 December
Your support here: http://www.peaceinsyria.org/support.php We, the undersigned, who are part of an international civil society increasingly worried about the awful bloodshed of the Syrian people, are supporting a political initiative based on the results of a fact-finding mission which some of our colleagues undertook to Beirut and Damascus in September 2012. This initiative consists in calling for a delegation of highranking personalities and public figures to go to Syria in order to (...)
read more...
THE KU KLUX KLAN ONCE AGAIN CONTROLS INDIANA
Monday 12 November
by : David R. Hoffman, Legal Editor of Pravda.Ru
7 comments
At first glance, the results of America’s 2012 election appear to be a triumph for social, racial, and economic justice and progress in the United States: California voters passed a proposition requiring the rich to shoulder their fair share of the tax burden; Two states, Colorado and Washington, legalized the recreational use of marijuana, while Massachusetts approved the use of marijuana for medical purposes; Washington and two other states, Maine and Maryland, legalized same-sex (...)
read more...
I’VE DECIDED TO "WASTE" MY VOTE
Sunday 28 October
by : David R. Hoffman, Legal Editor of Pravda.Ru
In a 2004 episode of Comedy Central’s animated series South Park, an election was held to determine whether the new mascot for the town’s elementary school would be a “giant douche” or a “turd sandwich.” Confronted with these two equally unpalatable choices, one child, Stan Marsh, refused to vote at all, which resulted in his ostracization and subsequent banishment from the town. Although this satirical vulgarity was intended as a commentary on the two (...)
read more...
HIGHER EDUCATION IN AMERICA: DREAM OR NIGHTMARE? PART IV
Friday 28 September
by : David R. Hoffman, Legal Editor of Pravda.Ru
PART I PART II PART III If there is one major inconsistency in life, it is that young people who know little more than family, friends and school are suddenly, at the age of eighteen, supposed to decide what they want to do for the rest of their lives. Unfortunately, because of their limited life experiences, the illusions they have about certain occupations do not always comport to the realities. I discovered this the first time I went to college. About a year into my studies, I (...)
read more...
HIGHER EDUCATION IN AMERICA: DREAM OR NIGHTMARE? PART III
Friday 28 September
by : David R. Hoffman, Legal Editor of Pravda.Ru
PART I PART II PART IV Disillusioned with the machinations of so-called “traditional” colleges, I became an adjunct instructor at several “for-profit” colleges. Thanks largely to the power and pervasiveness of the Internet, “for-profit” colleges (hereinafter for-profits) have become a growing phenomenon in America. They have also been the subject of much political debate and the focus of a Frontline special entitled College Inc. Unlike traditional (...)
read more...
HIGHER EDUCATION IN AMERICA: DREAM OR NIGHTMARE? PART II
Friday 28 September
by : David R. Hoffman, Legal Editor of Pravda.Ru
PART I PART III PART IV Several years ago, a young lady came into the college where I was teaching to inquire about a full-time instructor’s position in the sociology department. She was advised that only adjunct positions were available. Her response was, “No thanks. Once an adjunct, always an adjunct.” Her words still echo in my mind. Even as colleges and universities raise their tuition costs, they are relying more and more on adjunct instructors. Adjuncts are (...)
read more...
HIGHER EDUCATION IN AMERICA: DREAM OR NIGHTMARE? PART I
Friday 28 September
by : David R. Hoffman, Legal Editor of Pravda.Ru
PART II PART III PART IV When The Bill of Rights was added to the United States Constitution over two hundred years ago, Americans were blessed with many rights considered to be “fundamental.” One conspicuously missing, however, was the right to an education. This was not surprising given the tenor of the times. America was primarily an agrarian culture, and education, especially higher education, was viewed as a privilege reserved for the children of the rich and (...)
read more...
ONE SOLITARY LIFE, PART TWO
Monday 30 July
by : David R. Hoffman, Legal Editor of Pravda.Ru
3 comments
If there is one universal question that haunts all human beings at some point in their lives, it is, “Why do we die?” Death, after all, is the great illogic. It ultimately claims all, the rich and the poor, the mighty and the small, the good and the evil. Death also has the capability to make most human pursuits—such as the quest for wealth, fame and power—vacuous and fleeting. Given this reality, I have often wondered why so many people are still willing to (...)
read more...
HOW MUCH CORRUPTION CAN DEMOCRACY ENDURE?
Thursday 28 June
by : David R. Hoffman, Legal Editor of Pravda.Ru
6 comments
How much corruption can a “democracy” endure before it ceases to be a democracy? If five venal, mendacious, duplicitous, amoral, biased and (dare I say it) satanic Supreme Court “justices”—John Roberts, Samuel Alito, Antonin Scalia, Clarence Thomas and Anthony Kennedy—have their way, America will soon find out. In several previous articles for Pravda.Ru, I have consistently warned how the Supreme Court’s 2010 Citizens United decision is one of the (...)
read more...
DEMOCRACY IN THE HANDS OF IDIOTS, PART TWO
Tuesday 12 June
by : David R. Hoffman, Legal Editor of Pravda.Ru
1 comment
Imagine, if you will, that the United States government passes a law banning advertisers from sponsoring commercials on Rush Limbaugh’s radio show or Rupert Murdoch’s Fox (Faux) “News” Network. On one hand, there would be two decided advantages to this ban: The National IQ would undoubtedly increase several percentage points, and manipulative pseudo-journalists would no longer be able to appeal to the basest instincts in human nature for ratings and profit while (...)
read more...
DEMOCRACY IN THE HANDS OF IDIOTS
Thursday 7 June
by : David R. Hoffman, Pravda.Ru Legal Editor
4 comments
LIVE, from the State that brought you Senator Joseph McCarthy, Wisconsin voters now proudly present, fresh from his recall election victory, Governor Scott Walker! At first glance, it is almost unfathomable that anyone with a modicum of intelligence would have voted to retain Scott Walker as Wisconsin’s governor. This, after all, is a man who openly declared he is trying to destroy the rights of workers through a “divide and conquer” strategy; who received 61% of the (...)
read more...
PEOPLE WITHOUT SOULS
Tuesday 13 March
by : David R. Hoffman, Legal Editor of Pravda.Ru
2 comments
A question I’ve frequently been asked since I began writing for Pravda.Ru in 2003 is, “Why did you become disillusioned with the practice of law?” This question is understandable, particularly since, in most people’s minds, being an attorney is synonymous with wealth and political power. I’ve always been reluctant to answer this question for fear it will discourage conscientious and ethical people from pursuing careers in the legal profession—a (...)
read more...