U.S. Economic Armageddon: The “Real” Deficit – Including Non-Budgetary Items Like Unfunded Liabilities Of Medicare, Medicaid, Social Security And The Defense Budget – Is Actually $202 Trillion

“Enron Accounting” Has Bankrupted America: U.S. Deficit Really $202 Trillion, Kotlikoff Says

“Forget the official debt,” he tells Aaron in this clip. The “real” deficit – including non-budgetary items like unfunded liabilities of Medicare, Medicaid, Social Security and the defense budget – is actually $202 trillion, the professor and author calculates; or 15 times the “official” numbers.

“Congress has engaged in Enron accounting,” says Kotlikoff, who recently penned an op-ed for Bloomberg entitled: The U.S. Is Bankrupt and We Don’t Even Know It.

Yet, the debt market continues to have an insatiable appetite for U.S. Treasuries; heading into Monday’s session, the yield on the 30-year Treasury bond (which moves in opposition to its price) was at its lowest level since April 2009.

Kotlikoff says that’s because the market is focused on the “mole hill” of official debt. In time, the U.S. will have a major inflation problem to rival that of Germany’s post World War I Weimar Republic, he predicts. “We have to think about the fact that unless the government gets its fiscal act in order we’re going to have the government printing lots and lots money to pay these enormous bills that are coming due over time.”

http://northerntruthseeker.blogspot.com/2010/08/america-is-finished-enron-accounting.html

http://finance.yahoo.com/tech-ticker/enron-accounting-has-bankrupted-america-us-deficit-really-202-trillion-kotlikoff-says-yftt_535354.html

THE $”ZILLION” PIT!

The unfunded liabilities run up by the U.S. government are estimated at anywhere from $100 trillion to over $200 trillion. While the estimates vary quite a bit, does it really matter? Nobody can even conceive of what it means to owe $100 trillion. In other words, it will be impossible for the government to keep its promises..
The biggest piece of the unfunded liabilities is Medicare. Then comes Social Security. There is also Medicaid and government worker pensions. These are the big ones. For now, I will just focus on Medicare and Social Security..

These unfunded liabilities keep growing every year. There is no way that the government can keep these promises over the next 75 years, let alone the next 20 years. There will be some kind of a default. Many libertarians assume that the default will come in the form of inflation. But that will not take care of the bulk of the problem..
If there is high inflation, then Social Security is supposed to be adjusted for a cost-of-living increase. It will not solve the Social Security problem, unless the government stops giving a COLA or redefines it. If that happens, then seniors will get checks that buy less and less..

It is even worse for Medicare. If there is high inflation, then medical costs will just continue to skyrocket. This will make it even harder for the government to keep its promises..
The easiest form of default will be to increase the retirement age substantially. If Congress raises the age to 75 overnight, then that will wipe out tens of trillions of unfunded liabilities immediately. Of course, Congress won’t do this. It will take smaller steps in defaulting on its promises..

The so-called entitlement spending, the military spending, and the interest on the debt are greater than the total tax collections. In other words, you could eliminate everything from the federal government except for those few things and the budget would still not be balanced..

In conclusion, there will be some kind of a default in regards to Medicare and Social Security. The main avenue of default will be through raising the age to collect. If you are in your 40?s or 50?s right now, don’t plan to retire in your 60?s, unless you have done a really good job of saving for yourself. If Ron Paul had received the Republican nomination, there might be some hope right now of making good on at least some of these promises. But it isn’t going to happen with the continuation of big spenders in office…

Financial disaster looms for America: $106 trillion in unfunded obligations mounting up over 30 years

(NaturalNews) Listen. Can you hear it?

It’s a steady, rumbling sound and it is gradually rising in intensity.

That is the sound of an approaching economic tsunami, one which will consume America and destroy her future.

It is faint now, but not too faint. It is distant – but not too distant.

It will be here before you know it. And when it arrives, it will ravage everything in its path.

Surely our elected leaders hear the rumbling too. How could they miss it?

And surely they are taking the matter seriously, because they aren’t really all-consumed with just the next election cycle. No, they truly do want what is best for the country, partisan politics aside, right? After all, they are Americans too, and they – like all of us – are in the path of this growing economic tsunami?

Right?

If only.

More money than the world has

The good news is at least some lawmakers are concerned about the enormous amount of money in benefits - $106 trillion within the next three decades - that past generations of congresses have promised Americans, in order to secure their votes and remain in power.

Read more at http://investmentwatchblog.com