15.2 TRILLION and there ain’t no stopping us now
January 9, 2012 was a historic day in America. It came and went without much notice in the press or by the millions of Americans affected. Without Congressional approval, without a vote, without a whimper, the debt limit was automatically raised and the national debt became a record 15.2 trillion dollars.
The new debt number exceeds the total Gross Domestic Product of the entire nation,* which was $15.176 trillion in 2011. As Americans we should be outraged. We should recall and impeach all our elected officials who silently approved. But will we?
No. Most Americans don’t even realize the danger. Most won’t care until collapse is imminent. Then just like in Greece, riots will erupt and people will be confused wondering why they never saw this coming. I’ve been predicting this since 2004 and writing about it here since 2008. People smarter than me have as well, but no one listens.
Some with shallow understandings of macro economics argue, “it’s a harmless debt, we owe it to ourselves.” That’s like walking across the Sahara without water and saying, “But it’s a dry heat.” Nor is it unlike a 900 pound man claiming the extra 1300 calories in the Monster Thickburger won’t make a difference in his 20,000 calorie per day diet. In both examples the result is the same.
There must be a Constitutional amendment requiring a balanced budget and the time to pass it was 1998. But alas, better late than never.
Unfortunately, the President who once said the debt load was “un-patriotic” now predicts debt levels of $26 TRILLION within 10 years. I’ll go one better and safely predict $22 TRILLION by 2017 if Obama is re-elected. If Democrats regain the House I’ll say $24 TRILLION by 2016 — Financial meltdown on a scale that will dwarf Greece by 2020.
The Occupy people want all the benefits of big government but they don’t want to pay for them. They want those who will not share in the benefits to carry the burden of paying.
They demand jobs but insist those who would create the jobs divert that money to pay for more entitlements.
The 1980s are referred to as “the decade of greed,” but I propose there is far more greed today. People feel increasingly entitled to OPM (other people’s money) even if ultimately this keeps them unemployed. Because, hey, we’ll just hit them up for more to compensate. If this isn’t greed, I’m not sure what is. And it is far more toxic and dangerous than the greed which created millions of jobs in the 1980s. This current species destroys rather than creates jobs.
Nearly half (the Tax Policy Center estimates 46%) of Americans pay no taxes at all. But President Obama singles out those paying the most in taxes for tax increases. Now I am not in favor of taxing the poorest among us, but rather for closing loopholes that allow millions to go tax-free or to actually get money back after paying nothing in.
Another tool for fixing the debt problem involves fixing another problem. If we can get more Americans working there will be more people paying taxes because they will have a paycheck. Another added benefit is they will be consuming less government benefits since they will be off welfare, unemployment, food stamps, utility subsidies and the like. Combined we would see a multiplier effect on the debt. Less money being paid out and more being paid in, add to that more retail demand as personal income rises and we get even more jobs created, more taxes in, and less entitlements out.
But the President would rather use clever language to suggest that Romney and other wealthy Americans are paying less in taxes than a secretary. An impossibility even if Romney paid 1% to her 28%, as 1% of $20.9 million is $209,000 (now this is an absurd example, Romney actually paid 15.4% on investment income not earned income — the kind of money your 401k will someday pay you), and even the best paid secretary is unlikely to make $100,000.
The President did not accidentally word his statement as he did. It was designed to make millions, especially those in the “young and dumb” class think Romney was paying less than a secretary. (Now interestingly, it is rumored that Liberal billionaire, George Soros actually is paying less real dollars in taxes than your average janitor – perhaps none – even while calling for more taxes, but that’s a topic the Occupiers should take up between rapes and robberies.)
Perhaps there should be a minimum percentage tax on those making more than $1 million per year but this is a tricky subject as history has shown that when there is a punitive tax on millionaires thousands of millionaires disappear. They move overseas, hide money, and refuse to invest – to avoid making too much money. In each case revenues and jobs are lost.
Maybe we first plug the loopholes, stop the tax cheats, find those not even filing taxes, and create some private-sector jobs (you know the ones taxes don’t pay for but generate tax revenue.) That might be a good start, right?
President Obama reached out and grabbed Republicans by the short little hairs late last year and claimed he was cutting taxes on those who need it most while Republicans just wanted to give breaks to evil rich people. We, the working folks, need reasonable tax rates, but frankly we don’t create jobs, unless we’re investing our 401k money into the stock market. A pizza party every payday does not stimulate the economy, but investing in the stock market does.
If we impose punitive investment taxes to grab money from the rich what happens? You invest in a 401k to make a profit so you can retire more secure. Right?
Well, when we tax the crap out of investments who gets punished? Yes the rich, but that bat swings 2 ways. Try to take your 401k money out to pay the bills once you retire and BAM! 30, 40, or maybe 60% is tax. Why? Because YOU demanded it when you thought you were spanking those wealthy bastards.
And what about those generous $39 per paycheck tax cuts Obama gave us for two, yes, two months. That money came out of the Social Security fund. You remember the one Al Gore wanted to make a lockbox. When Republicans talk of reforming Social Security they are called Nazis and thieves, but when Democrats literally steal money from the elderly no one cares.
Shame on Boehner and the Republicans for not bringing out poor old people to cry about how Obama wanted to take food out of their pantries. They should have! Maybe no old people lost anything today, but how many of us will lose SS benefits because it went bankrupt and had to be shutdown sooner because funds were robbed over the years?
Today $15.2 TRILLION, tomorrow how much? When do we finally standup and say “NO MORE!” We can’t afford to spend more than the entire nation earns every year. Imagine where you’d be if somehow you spent more than your entire community earned in a year? I’m sure you’d look good in orange.