THE UNITED STATES IS BANKRUPT

by Bill Baker, J.D.
Editor and Publisher, The San Bruno Beacon

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The FED buying more government debt to prop up the failed U.S. economy is like a person  running up debt on one credit card to pay down the debt on another credit card.

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On July 6, 2010, I wrote an article titled, WE ARE IN THE GREAT DEPRESSION OF THE TWENTY FIRST CENTURY. WHAT WILL YOU DO TODAY TO CHANGE AMERICA? In that article, I observed, "From an economic standpoint, California and the United States are doomed".

Today, I was reading an interesting article titled, U.S. Is Bankrupt and We Don't Even Know It by Laurence Kotlikoff who is an economics professor at Boston University. In his article, Mr. Kotlikoff states:

"...........you will find that the IMF has effectively pronounced the U.S. bankrupt. Section 6 of the July 2010 Selected Issues Paper says: 'The U.S. fiscal gap associated with today’s federal fiscal policy is huge for plausible discount rates.' It adds that “closing the fiscal gap requires a permanent annual fiscal adjustment equal to about 14 percent of U.S. GDP.' "

In his August 10, 2010 article, Professor Kotlikoff goes on to say, "Most likely we will see a combination of all three responses with dramatic increases in poverty, tax, interest rates and consumer prices. This is an awful, downhill road to follow, but it’s the one we are on.........................The fiscal gap is the government’s credit-card bill and each year’s 14 percent of GDP is the interest on that bill. If it doesn’t pay this year’s interest, it will be added to the balance."

Professor Kotlikoff's observation about a bankrupt U.S. economy is echoed in an August 11, 2010 article titled, "America is 'Bankrupt Mickey Mouse Economy" in which Jochen Wermuth, the Managing Partner at Wermuth Asset Management observed, "America today looks like Russia in 1998. Consumers, companies and the government are all highly indebted. America as a result is a bankrupt Mickey Mouse economy....." Wermuth made these comments after Federal Reserve Bank (FED) officials said they would buy more government debt. The FED buying more government debt to prop up the failed U.S. economy is like a person  running up debt on one credit card to pay down the debt on another credit card.

The Obama Administration and the Democrats in Congress have destroyed the U.S. economy by building on the mistakes of the Bush Administration and burying the United States under a mountain of debt that will never be paid off and will only grow larger as the interest on the debt grows along with the increased government spending that is adding to the debt.

Most Americans continue to engage in the same delusional process of continuing to elect the same destructive, corrupt politicians to Federal, state and local political office thinking things will change. Things will only continue to get worse as long as we keep electing the same corrupt, morally bankrupt individuals to political office.

We have sowed the seeds of our country's economic destruction by refusing to recognize that the same morally and intellectually bankrupt people who we elect to political office, at all levels of government, will continue with their fraud, corruption and malfeasance that is destroying our nation as long as we allow them to do so.

With the proverbial walls of our nation crumbling into dust, how can Americans not recognize that the moral and economic fabric of our nation is being shredded by elected leaders, at all levels of government, who are morally unfit to serve our nation and their communities and who support economic policies that are turning America into a cesspool of poverty?

How can America's voters be so afraid to fundamentally change our Federal, state and local government's policies and direction when the status quo is destroying and bankrupting our nation?