Debt load: The real economy

Published 15 years ago -  - 15y ago 34

With three months to go in fiscal 2004, and four months until national elections, the Bush administration is only $110 billion short of reaching their self imposed and ridiculous statutory public debt limit. It will mean that they’ve borrowed $984 billion (call it a cool trillion) since May 23rd of last year. Isn’t that nice? Do you think it will effect the elections?

One billion is a thousand million. And one trillion is a thousand billion. Most humans can’t even count that far without a calculator or computer. If you could go back in time a billion minutes, you could talk to Jesus Christ. And if you set aside seven million dollars a day from Christ’s birthday until today, you still would not have enough to pay off our national debt.

While the spinmeisters tell us the economy is improving ask yourself how much business or how many jobs do you suppose anyone in their right mind could create with a trillion dollar infusion of capital? And that’s on top of the roughly $1.8 trillion the government collects in annual taxes.

In fiscal 2003, between October 1, 2002 and September 30, 2003, the borrowholics ran up the national debt $555 billion. A nice round number and the prefix Hollywood uses in most of its movie phone numbers.

At the rate we’ve been going, and if he has a demonic sense of humor, John Snow the Secretary of the Treasury could end the present fiscal year September 30th with a debt increase of $666 billion, the mark of the beast. Besides setting a new record for the borrowholics, that ought to give the Stephen King fans, the end-of-the-world hawkers, and the skull and bones society something to talk about. Nobody else seems to care.

Last year, the federal government went from February 20th, when they hit the debt ceiling, until May 23rd, a period of 92 days without borrowing an additional cent. The Treasury can do this again. At some point, they can simply stop adding new debt until after the elections and then sock it to you like there’s no tomorrow.

If anyone wants proof that the media conglomerates and the so-called investigative “free press” are in cahoots with the government and ought to be called the Ministry of Propaganda, this three month period of absolute and obedient silence clinches the case. When, at other times, the watchdogs were warning of possible government shutdowns, there wasn’t a peep about the debt limit until a few days before it was raised a trillion dollars on May 23, 2003. Three months of no news on this prohibited subject.

Here we go again.

In the first week of May, 2003, I wrote and published an article titled “Mayday” that covered this dry spell in news about the debt and provided links to downloaded U.S. Treasury’s Daily Reports that verified the fact that we were holding at the debt ceiling day after day. No one cared.

It can’t be that the watchdogs were so engrossed in the invasion of Iraq that they didn’t have time or space to cover our preposterous debt because they still had room to devote some of their energies to the Laci Peterson saga just as they continue to do today.

Stand by for another similar trick from the Bush administration to carry through the elections of this November. Having already asked Congress for an increase to their phony debt ceiling with no response, you can expect another news cover-up when we again hit the debt ceiling sometime in August.

Neither can you expect anything meaningful from the democrats. The rip-off is nonpartisan. It was Bill Clinton and Al Gore who ran around bragging about “paying down the national debt” in 2000 when the debt actually continued to climb. They had a debt laundering operation that stole your Social Security and other surplus entitlement money and would have made Marc Rich and Kenneth Lay proud.

On top of that, it was the Clinton administration that argued for ages and finally passed the Balanced Budget Act of November 1997, an act that chose the year 2003 to finally live within its means. Isn’t that a joke? How much of this failure can be laid at the feet of terrorists without, at the same time, admitting how vulnerable we are?

Credit is the name of the game, and it’s your credit the government has been squandering.

How long do you suppose this can go on?

Coupled with creeping inflation, we’ve already got a worldwide decline in the dollar that’s frightening and an international balance of trade that’s completely out of whack. Add to that the fact that industries which made this country great are “outsourcing” to cheaper labor markets to maintain profits and you’ve got an impending disaster.

How long before countries like China, that loans us about $300 billion a year, simply refuse to loan us any more? How long will it take them to start to realize that the American people might not be able to pay them back, decide to invest elsewhere, and cut off this sort of welfare?

The U.S. Treasury is already experiencing a decline in the amounts it can borrow. Less than half of the securities put up “for sale” are actually purchased. Should they simply hold more auctions? Or do we threaten investors with our military might and the fact that we are becoming a rogue nation?

Here’s the nut of it.

During the month of May, 2004, the national debt went up $78 billion ($77.9 billion). Only $12 billion ($11.8 billion) was borrowed from investors. Almost all of the rest, $66.1 billion, was part of the annual interest paid to Social Security against its $1.5 trillion ($1.484 trillion) and 22 percent of the national debt held at the close of fiscal 2003.

This interest is due twice a year, once in December and again in June. It’s the only reason the debt ceiling was finally increased last year.

Worst of all, this interest is paid without any real cash involved – no money is turned over to the Social Security Trust Funds (Federal Old Age & Survivors Insurance and the Federal Disability Insurance trust funds that we normally speak of as one trust).

Instead, what the trust gets are more bogus nonmarketable bonds simply handed out, but increasing the public’s indebtedness. It’s all part of the biggest economic scam any government has ever pulled on its own citizens. And it has been going on for a long, long time.

The Beltway Bandits try to disguise this scam in many ways. One way is to simply name part of the debt “Public Debt” in order to make people believe that’s the only portion they are responsible for paying back – while the other portion is called “Intragovernmental Holdings” to imply that the government owes itself or one department owes another (where no transfer records are kept) and by some miraculous method can be redeemed without taxpayer money.

The interest payment is part of the pretense that the government merely “borrowed” surplus entitlement money when they are actually stealing it from the supplemental retirement system, health care payments, gas taxes that are supposed to go to highways, airport taxes and twenty-five entitlements in total. Social Security just happens to be the largest with the greatest continuing surpluses from excessive payroll taxes.

Neither the media, the press, nor the so-called watchdog groups bother to ask politicians exactly why the Social Security trust funds are more than twenty percent of the national debt.

John Kerry, the likely democratic candidate for President, serves on the Senate Finance Committee, the Sub Committee on Social Security, and Senate Sub Committee on Health and Family Services. In other words, he knows exactly what’s going on and he has nothing to offer in the way of reform. He’s as silent as the Ministry of Propaganda.

If Donald Duck were running for the presidency, he could win hands down by exposing this fraud and cutting the national debt nearly in half by eliminating the double taxation involved in this scam.


Published originally at : republication allowed with this notice and hyperlink intact.”

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