Thursday, February 7, 2013
Obama Drone Terror! U.S. Can't Pay off DEBT!
By Reginald Kaigler (DEMCAD)
Face Reality: U.S. Can't Pay off DEBT
I recently interviewed financial and precious metals expert Dr. Lee Warren and a viewer commented that the doctor was incorrect in claiming that the federal debt could not be paid off. The viewer claimed that if taxes were increased by 5% across the board, the deficit could be solved in 10 years.
Well, let's take a closer look at that claim. The United States has been running huge deficits since 2000. Essentially, the federal government is spending more money than what it is collecting from tax dollars.
If the gov had 2.4 trillion in revenue and 3.7 trillion in spending in 2012, how is a 5% tax increase going to help?
First, you would have to assume that a tax increase would lead to a significant inflow of cash for the federal government. You would have to assume that the big increase in taxes would have no effect on business activity and would only encourage growth. Two assumptions that are not backed by any evidence.
But let's say that raising taxes somehow lead to a huge tax increase.
Let's assume revenue doubled to 4.8 and spending remained at 3.7 trillion. That's 1.1 trillion surplus every year. We have 16 trillion in debt, if we had 1.1 trillion surplus years for 10 years, we would still owe near 5 trillion dollars and that doesn't even include the medicare social security liabilities.
The real liabilities of the federal government are Social Security, Medicare, and federal employees' future retirement benefits, which already exceed $86.8 trillion, or 550% of GDP. That's 550% of the entire economy in one year. That's translates into five years of the total production and services of the entire economy just to pay off the debt.
What this means is that the entire system is insolvent and there is no way to save it. The sooner people face that reality, the easier it will be to start to prepare for the inevitable collapse.
Historical Federal Receipt and Outlay Summary
Cox and Archer: Why $16 Trillion Only Hints at the True U.S. Debt
Obama Drone Terror
So not only is the empire crumbling, the emperor has gone mad. The Obama White House recently declared that it was legal for the federal government to use drone strikes to kill American citizens as long as the government believed the target was an operational leader within Al-Qaida or a related group even if there was no evidence or intelligence of an active plot against America.
Essentially, the White House is ignoring Due Process and declaring that it can kill anyone.
Last weeks unemployment claims stood at 366,000, while Nonfarm business sector labor productivity decreased at a 2.0 in the fourth quarter. Remember, the commerce Department claims that GDP only dropped 0.1% in the fourth quarter. Expect a revised number, the economy is contracting.
BLS: PRODUCTIVITY AND COSTS
I told my viewers to consider buying a rifle before the election. Before there was a crisis and the guns flew off the shelves and become unaffordable. Unfortunately, the day has come for millions of Americans. AK pattern rifles that sold for 600 bucks is now at 900. If you didn't prepare by storing guns and ammo, I don't know what to tell you. Hopefully, things claim down as more supplies arrive, but you can't afford to abandon your other emergency preparations. Good luck.