By Mark Hendrickson
A trillion dollars is a LOT of money. Stacking hundred-dollar bills flat on top of each other, a forty-inch stack would be one million, a stack one-and-one-half times as tall as the Empire State Building would be a million, which a stack 631 miles high (from Pittsburgh to the other side of St. Louis) would be a trillion. That’s just one trillion. The national debt is approaching $17 trillion.
That is the official total. However, that figure greatly understates the problem by not counting unfunded liabilities. During the previous two fiscal years, the government added $2.6 trillion to the nominal national debt, but using GAAP (generally accepted accounting principles) the actual tally was over $10 trillion of new debt…….To repeat: The massive federal debt never will be paid. One reason is the simple economics of debt: The more debt there is in a society, the more current income is needed to service the debt rather than to produce new wealth. The marginal productivity of debt (that is, the amount of new wealth produced per dollar of new debt added) has been declining in the U.S. for half a century. During the 2008-9 financial crisis, it fell below zero. Whatever the figure is now, we simply aren’t able to get much bang for our additional debt bucks, sort of like a junkie in the advanced stages of addiction…. And the implosion is coming…..Read More »
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