I'm Almost Glad I Am Getting Old...

... because I won't have to face the full consequences of this:

The 2009 federal balance sheet indicates that the government's net position (total assets less total liabilities) is a negative $11.5 trillion, 12.3 percent worse than the previous year. But that's just the tip of the iceberg. That negative balance excludes government obligations for social insurance programs, mainly Social Security and Medicare.

Whether social insurance should be booked as a liability has long been a controversial issue among government accountants....

Unable to reach agreement as to whether social insurance should be included as a balance sheet liability, the members of the FASAB compromised, and thus, immediately following the balance sheet is a "Statement of Social Insurance." In the 2009 annual report this indicates that the total present value of estimated social insurance expenditures over revenues is $45.9 trillion.

Hence, simple addition indicates that the total net position of the government is a whopping negative $57.4 trillion.

  • Bram

    Our unfunded debt (government promises) is valued at $109 Trillion. The total value of the country is $55 Trillion. We are beyond broke and nobody since Bush tried to get Congress to fix Social Security has the balls to admit it.

  • I often hear people muse about how this will affect the next generation. I think the reckoning is much sooner than that! I guess this is what happens when politicians and media convince people that even though individuals can't borrow and spend their way to prosperity, apparently the collective can!?

    Keynesians will prove to be the most dangerous threat the US ever faced. When people realize that there is no practical difference between the two parties on any issues that matter, perhaps then change may come.

  • Mark

    To Dave:

    Yeah, I agree with you that except for the early 80's there has been little difference between both parties. They both try to constrain our freedoms, but have different flavors of what freedoms the want to restrict, they also are both pretty much Kensesians.

    The problem is our system is designed to favor 2 parties, because the way the system is designed, for the most part the threshold is very high for getting into government. If you have a state with a 50% law, you need to get 50% of the vote to have representation for your party, if you have a majority vote state then if lucky your third party needs at least 34% against dem and rep opponents.

    Yeah a change can happen like in the 1850's when the Whigs were dissolved, but since then both parties have become entrenched, and it is very difficult for a new party to break through. Not being in office prevents new parties from getting their ideas into the mainstream.

    I think it might be time to try to convert some of our state senates, into parliamentary systems, where people statewide vote for a slate of candidates, and the candidates are apportioned based on the popular vote. This way small parties can get some representation with around 5% of the vote. This would allow small parties to have representation, present ideas, and improve on their ideas allowing them to get more and more of the popular vote.

  • caseyboy

    I am in favor of a party named The Anti-Incumbent Party. Doesn't matter if they are Democrats or Republicans, once they get in office they feel the need to legislate, control and consolidate power in Washington.

    The founding fathers had this quaint idea that members of the community would go off to Washington to represent their constituents for a short period of time and then go back and pick up their lives where they left off. Fresh ideas, from real people that had to deal with the laws they passed. I believe it was Ben Franklin that said the Constitution is a perfect governing document, but requires that the governed be a moral people. Our politicians are corrupt and the Constitution is being shredded in the name of progress.

    The game is rigged against any 3rd party getting a foothold. The power of incumbency is too strong to break through. Between gerrymandering congressional districts, earmarks and media exposure incumbents are well insulated from electoral challenge.

  • DMac

    RE: Dave. I agree that the reckoning will come in our lifetime. I'm now 50, and I believe that Social Security is anything but secure. I'm not counting on collecting anywhere near what the annual summaries tell me will be there for me. We will see all sorts of means testing, and while the name of the program will remain, the concept will be stripped of any pretense of an investment return on 'contributions'. Just another income redistribution scheme. The taxes on my earned and (so called) unearned income will continue to rise, until my estate is gone, and my kids will qualify for the government programs.

  • Steve

    DMac:
    Just wait until the Government decides that it knows better than us what we need for retirement and decides that we are unable to "properly" manage our 401K accounts. I can just imagine the Press helping out the current party in power with sob stories of how this all came about because of the nasty conservatives who are ruining our country, and that the only solution is for the Government to run our private retirement accounts for us.

  • Keith

    Steve,
    You don't have to imagine it; it's already happening:
    "Why It's Time to Retire the 401(k)", Time, Oct. 09, 2009,
    http://www.time.com/time/business/article/0,8599,1929119,00.html

  • Doug

    Expanding on caseyboy's comments: all my life, I've been told that a two-party political system is the only one that works. Like most of us, it's been drilled into my head that there are no alternatives. Either go with party D, or party R.

    But after witnessing these last few months, it dawns on me that having more than two political parties is *precisely* what's needed now. Imagine that there were, say, 5 member of the Tea Party in the Senate, completely unaligned with the other two parties. Do you think that this infernal Obamacare debacle would have made it out of the Senate? Or even the House? Just a small minority could easily end the ramrodding of bills through either chamber that we have witnessed this last year.

    Three political parties, or more, could easily bring Congress to a grinding halt. The harder it is to get something through Congress, the better off we will all be. With any luck, a budget would never make it out and the entire money-eating machine could be starved in no time.

  • caseyboy

    Doug - Had there been 5, 10 or 40 Tea Party senators there still would have been enough democrats to pass Obamacare. Unless you take the democrat numbers down you will be left with big government solutions to government created problems. If disenchanted Republicans form up a 3rd party under the Tea Party banner it assures democrat dominance over the near term. I believe that a Tea Party would eventually elevate to the dominant party and result in policies more closely aligned with our founding principles. That would be a very good thing.

    The problem is that while this political shift is taking hold the democrats could do great, possibly irreversible damage. I think the best course of action is to work for tea party type candidates in the Republican primaries. Marco Rubio is going to knock off Charlie Crist in Florida and I'm told that JD Hayworth is closing the gap with John McCain. Replacing a few of these establishment Republicans would send a message to the rest. And, I think the fastest way to halt the progressive agenda is to get the GOP reoriented to tea party principles.

  • epobirs

    Actually, you could find yourself facing the consequences in a very direct way.

    The generation entering adulthood in the next few years is going to be confronted with a massive insurmountable debt from the entitlements promised to the boomers, who are just now starting to retire in large numbers. This problem is far worse for Europe where low birth rates make the burden even greater but once you're talking dozens of $Trillions it becomes difficult to see much difference. It just hits some places sooner.

    Remember a few years ago, how a heat wave took out about 15,000 elderly French citizens while much of the populace was on vacation? This was supposedly accidental but that doesn't mean it cannot serve as valuable data. Somewhere in the French government is a team of accountants assigned to figuring out how much money has been saved by the sudden elimination of that large number of dependents. This goes hand in hand with the finding a few years ago by one economist who claimed smokers were a net economic benefit rather than a drain as anti-smoking campaigners supposed. The reason being that most premature deaths from smoking were long, drawn-out and expensive demises from lung cancer but rather sudden death from heart disease. Most of those dying were doing so before retirement age and never drawing on the funds they'd paid into Social Security and Medicare.

    I strongly suspect that within a decade or so, the life spans of those below a certain level of wealth will see a sharp decrease. Most places won't see outright mass euthanasia of their elderly dependents but it'll happen in more subtle ways. One way or another, the generation that ran up the bills will pay.

  • Henry Bowman

    Michael Ramirez summed the situation up nicely more than a year ago:
    http://www.gocomics.com/michaelramirez/2009/02/27/

  • txjim

    I agree with caseyboy - as much as the thought of a third party appeals to me I am convinced the easier path is to take over the Republican Party. It will not be easy because the people we need to boot will not give up & leave quietly. The Charlie Crist and Lindsey Graham types of the party will undermine us every chance they get. And as always the big government loving media will help them.

    We also need to work on retaking our corporations. The crap that goes on inside most large corporations today is as anti-tea party as anything government does. And with 401k funds directed by people who's prime directive is snorting coke off the belly of hookers, we have to get more involved in how our money is being invested.

  • markm

    caseyboy: "Doug – Had there been 5, 10 or 40 Tea Party senators there still would have been enough democrats to pass Obamacare."

    The Democrats didn't make gains in 2002-2008 because socialism became more popular, but because the Republicans have been earning their unpopularity ever since they let GHW Bush foist his least reliable son off on them. If there was a viable third party - which implies an election system (runoffs or proportional representation) that makes more than two parties practical - the Republicans' losses would not have been the Democrats' gains, and we would have wound up with a House and Senate where the remaining Republican-lites were the swing vote between real conservatives and Democrats.

    But that isn't the election system we now have. Most elections are for a single position without runoffs, so in a 3-candidate race, it's possible to win when 66% of the people voted against you. That means a third party would simply hinder the party with the closest positions. Given that, taking over an existing party is the most sensible course.

    And it should be possible. The socialists did it to the Democrats in 1972. I don't recommend following that up with a Presidential candidate that's as far to the right as McGovern was to the left, but I don't think that will happen. No matter what the leftist media says, the Tea Partiers are mostly not crazy idealogues.