Is Our Debt Burden Really $100 Trillion?
Submitted by emalvini on Wed, 11/28/2012 - 15:12Is Our Debt Burden Really $100 Trillion?
The problem with budgeting 75 years into the future is that you end up with a lot of numbers that are much more meaningful to actuaries than to other living people
1 NOV 28 2012, 9:03 AM ET 39
Wanna scare somebody about America's debt on the eve of the Fiscal Cliff? I mean, really scare somebody? Here's a trick. Don't talk about the debt. Talk about "unfunded liabilities."
The U.S. national debt comes out to about $16 trillion today. That's something. But it's nothing compared to the extra $87 trillion in unfunded liabilities to Social Security, Medicare, and federal pensions. Here's how that works. If you add up all of the U.S. government's promises to pay retirement and health care benefits for the next 75 years and subtract the projected tax revenue dedicated to those programs over the next 75 years, there is a gap. A $87 trillion gap -- in addition to a $16 billion hole.
"Why haven't Americans heard about the titanic $86.8 trillion liability from these programs?" Chris Box and Bill Archer ask in the Wall Street Journal. The authors blame the U.S. government for using shoddy accounting and for misleading the American public on their finances. In fact, the most misleading thing about that $87 trillion is the way the figure is often used in the media.
Read more: http://www.theatlantic.com/business/archive/2012/11/is-our-d...
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Have you got a mouse in your pocket?
It's not my debt. I have heard of estimates as high as $215 T.
Overblown
Overblown. The breakdown, IRRC, is 11 trillion in SS liability, 15 trillion in prescription drug liability, and 60 trillion in other Medicare liability.
Primarily, it assumes that the currenty 3 trillion in the SSI fund will earn 0% interest. That is false; that is money in treasury bills, that earn interest, that must be paid out. Saying that social security is going to face problems because of interest costs is ridiculous.
It is also overblown because they assume that healthcare costs are going to skyrocket and medicare is going to continue to fund it. If Medicare really grows out of control, cuts or tax raises will be implemented. Part D was never funded anyways...
What is scarier is that the total debt is much higer. 18 trillion in federal, state, and local debt. 16 trillion in personal debt. 25 trillion in business debt.
Plan for eliminating the national debt in 10-20 years:
Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...
Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a
Payment
Who is going to pay for this? :O
These are astronomical numbers/figures.
Sadly, only a war could may erase these numbers because I do not think this will be liquidated ie. written down or off or whatever you want to call it or the liklihood that spending will be drastically cut is also out of the question imo. :(
A war because the spoils go to the victors.
donvino
Both social security and
Both social security and medicare are legally obligated to be paid out. They are not even allowed to dip into general revenue; only their trust fund.
Oddly enough, Obamacare is what solvates medicare. Obama's 75 billion cut to medicare does a fairly good job balancing it out. Using Cox and Arnold's numbers (which are of course ridiculously overblown), the cuts amount to 57 trillion in liability savings.
Social Security is already solvent.
Plan for eliminating the national debt in 10-20 years:
Overview: http://rolexian.wordpress.com/2010/09/12/my-plan-for-reducin...
Specific cuts; defense spending: http://rolexian.wordpress.com/2011/01/03/more-detailed-look-a