Many students were there just to get a grade and to complete
their useless social studies degrees on the way to an advisor’s assurance of a
six-figure salary job on day one, an offer that would never materialize on
their limited horizons. They did not care that their parents went in debt to
pay for this college miseducation they received or that hard-working taxpayers
funded their federal grants for four years. Most of them had no clue how the
economy ran nor did they care.
It is painfully obvious that today students and college
graduates are just as woefully incompetent and uninformed. They are voting in
droves for their Marxist/communist of their choice, falling for empty promises
of free education in their communist utopia of free birth control pills and
free legalized drugs.
None of them paid attention in Economics classes that in communism
abortion is not a choice, birth control pills are not available or expensive,
and drug use is punishable with hard time in jail. Education is free technically but there is no
room to educate everybody in the halls of higher learning, so only a select few
are chosen, usually the elite’s children are picked first, regardless of
grades. If there are places left, then those with the highest scores are admitted.
Someone who spends a lot of his time running computer models
to predict economic downturns, upturns, bubbles, crashes, and collapse,
attempted to educate the audience on Facebook. Most of his advice fell on deaf
ears because people are tired of listening to anybody, they know it all already,
and have already made up their minds to go full speed ahead off the cliff, they
want to try things for themselves, why listen to reason and rational thought.
Repeating failed history in hopes of a different result seems enticing to most
people.
In his analysis, in an economic environment of “120 percent
debt to GDP ratio, we have less than five years before economic implosion.” He
defined “Point Zero” as the point where the national debt becomes 120 percent
of GDP, an unsustainable scenario that would cause an unrecoverable spiraling
downturn of the economy. A black swan event would make things much worse.
In order to make sure the economy becomes sustainable again
in the face of a 19 trillion national debt, “entitlements” must be reformed,
spending and waste must be cut, some regulatory burdens on corporations must be
reduced or eliminated, and taxes must be raised.
And this does not even begin to address unfunded liabilities
such as Social Security and Medicare. Entitlements comprise 70 percent of the
budget and debt servicing is 10 percent. This leaves just 20 percent of the
budget that can be cut. Is that sufficient to even begin reducing the huge
national debt?
Cutting the corporate credit card will force Congress to
balance the budget. They cannot spend more than they take in from Treasury
auctions and taxpayers. How many Congressmen will risk their careers in order
to do what is right? Congress does not seem willing to address any of the above
because they do not want to compromise their political careers and thus destroy
the power they yield in Washington.
Even though both spending cuts and tax increases are
necessary, Congressmen fight and politically posture on both sides of the isle while
nobody’s pet project or state funding gets cut. Why are Congressmen unwilling
to cut pet projects? When they do, they know their constituents will vote them
out of office.
We keep giving money to the U.N., we fight unwinnable wars
with strange rules of engagement, and we waste more money on our political
friends and foes overseas at a time when we can ill-afford it.
To make matters worse, inflation is looming on the horizon
because of the three quantitative easings (QEs), printing money without the
backing of goods and services in order to purchase our own debt.
The corporate mandate of the Affordable Care Act (ACA) has
not even taken full effect yet. We are not sure if Congress will repeal Obamacare
without a replacement. The preexisting conditions’ feature of ACA is a good
idea. In spite of dishonest political rhetoric,
nobody will die in the streets without medical care.
But there is rationing occurring already due to the
burgeoning and very expensive bureaucracy. We cannot offer care to more people
and illegal aliens without substantial costs to the nation which so far seem to
be far greater than if we would have given free premiums to the millions of
uninsured who, before ACA, could not secure nor afford medical insurance. Some
of them were already recipients of Medicaid.
We are sitting on a
social unrest powder keg as evidenced by Ferguson, Baltimore, the Black Lives
Matter, the collegiate race-baiting violence, and ISIS coming to our shores via
unprotected borders. The social cohesion is breaking down faster than you can
say All Lives Matter.
Even though our
national debt to GDP ratio is quite high (104.7%), our economic situation is
slightly different than Greece’s because we can print our own dollars. http://www.tradingeconomics.com/united-states/government-debt-to-gdp
Our fiscal policy
is in a mess. Taxation burdens the middle class and favors crony capitalism
while spending is out of control. Almost
50 percent of the country does not pay any taxes and crony corporations move
their headquarters to other countries to avoid paying proper share of taxes. Because
corporate tax in the U.S. is one of the highest in the world, Congress enabled corporations
to move overseas via Congressional bills.
The burden of
taxation falls on the middle class yet again. TPP is going to move most of the
remaining manufacturing sector overseas, transforming U.S. into a service
economy and destroying many blue collar and white collar jobs in the process.
Congress originates
the spending bills and approves them. The President can express what he wants and
signs or vetoes bills, but the ultimate spending power and control rests with
Congress. Congressmen are few and far between who have strength of character or
the will to do what is unpopular. Nobody wants to be perceived as hurting
parents trying to feed their kids, put a roof over their heads, or as “throwing
grandmas over a cliff.” So the out-of-control spending continues to balloon.
American citizens themselves
do not want to give up their instant gratification and suffer without their
Starbucks coffee and the pain or indignity of a less than 75-inch TV or other
electronic gadgets that are creating the blue screen hunchback nation. Why bear
responsibility for yourself when Uncle Sam can do it for you?
Presidential
hopefuls make promises to the electorate that will not reduce debt substantially
in the absence of a robust and sustained economic growth that would bring in additional
revenues. Some talk about “entitlement” reform by increasing the retirement
age. Proposals to create economic growth are not very encouraging. There is no
magical pot of gold at the end of the rainbow, nor another bubble that would bring
in enough revenue to offset the very large budget and reduce the unpayable
national debt.
