On January 10, 2019, RealClear Politics published an article titled, “Unfunded Govt. Liabilities — Our Ticking Time Bomb” by Myra Adams (A media producer and writer who served on the McCain Ad Council during the GOP nominee’s 2008 campaign and on the 2004 Bush campaign creative team.)
Like all these previous articles comparing the federal debt to a ticking time bomb, the article was utter nonsense.
Here are some excerpts and comments:
Tick, tick, tick goes the time bomb of national doom. Every second the ticking grows louder, but you won’t hear the muffled sound that’s more akin to white noise.
The doom of which I speak is unfunded liabilities — $122 trillion in payments the government owes and has promised its citizens — without the funds to fulfill those obligations.
Across all media platforms, the threat goes largely unreported. Members of Congress from both parties are also deaf to the ticking.
The same is true at the White House, where Donald Trump, like Barack Obama before him, never mentions this impending catastrophe.
Oh, my. “Time bomb of national doom.” Hyperbole usually is used when facts are absent. That is the case with Ms. Adams’s article
“My goal is not to chase a balanced budget just for the sake of balance. My goal is how do we grow the economy, put people back to work, and if we do that we are going to be bringing in more revenue.
“If we control spending and we have a smart entitlement package, then potentially what you have is balance – but it is not balance on the backs of the poor, the elderly, students who need student loans, families that have disabled kids.
“That is not the right way to balance our budget.”
In short, Obama believed the debt was too high, but didn’t want to make the middle classes and the poor suffer, which by the way, is the only way to stop the “time bomb of national doom.”
Why? Because that so-called “time bomb,” consists primarily of federal deficit spending — the “unfunded liabilities” for entitlements — Social Security, Medicare, Medicaid, poverty aids, education aids, and everything else the government does to help the middle classes and the poor.
And, Obama knew that cutting these programs would be a political disaster. Sadly, he didn’t reveal that cutting deficit spending also would be an unnecessary economic disaster.
The article continues:
Among the hordes of 2020 Democratic candidates, count on the time bomb to be a topic non grata while Medicare-for-all gains momentum and Medicare-as-is remains a lethal bomb component.
Before you call me an alarmist, I refer you to the U.S. Debt Clock. Here you can watch our time bomb tick in real time with that $122 trillion in unfunded liabilities as one of the major “fuses.”
Ah, the inevitable, phony debt clock sign, which is funded, and then referred to, by those least knowledgeable about economics.
And notice those words, “YOUR family share.” Ridiculous and a lie. Your family does not owe a penny.
Your parents never paid a penny for past federal debt; you will not pay for the present federal debt, and your grandchildren never will pay for the future federal debt.
Not one tax dollar ever is used to pay for the federal debt. This is explained later in this post.
Then the article becomes truly childish in its attempts to shock you:
Surely, such an incomprehensible number makes you gasp. But now, get ready to gag because in 2023 the “Debt Clock Time Machine” projects unfunded liabilities will be $157 trillion, a $35 trillion increase in only four years.
I would wager that a majority of citizens have no concept of what “just” $1 trillion looks like or even means. For the record, one trillion is 1,000 times 1 billion.
And, since $1 billion is thrown around Washington like a rounding error, it is instructive to remember that 1 billion itself is 1,000 times 1 million.
OMG! I’ll bet 1 million is 1,000 times 1 thousand! Am I right, Ms. Adams?
The Debt Clock displays federal tax revenue at $3.3 trillion, but spending at $4.2 trillion.
This annual imbalance means that not only are we promising too much down the road, we can’t cover our current costs, and we fall behind even more — every second of every day.
No, what it really means is the federal government is pumping .9 trillion growth dollars into the economy — dollars that go into the pockets of Americans. Without federal deficit spending, the economy would fall into recession or depression.
The so-called, misnamed federal “debt” was only $40 billion in 1940, and now, 80 years later, it is near $20 trillion.
And every year, for those last 80 years, writers like Ms. Adams have been calling it a “ticking time bomb.” (See: “It is 2019, and the phony federal debt “time bomb” still is ticking.”)
Strangely, it never seems to occur to the Myra Adamses of the world, that the “bomb” never explodes.
Being wrong for 80 consecutive years is a strong signal to change your mind. But they just keep on shoveling the bullsh*t.
And now we come to the “solution” that the rich want you to believe is necessary: Cut benefits to the middle and the poor.
Here it is, as delivered by Ms. Adams:
Reducing Social Security benefits — the main driver of unfunded liabilities — will be painful now, but even more painful in 2034 when present inaction forces draconian cuts.
What if every news network continuously displayed the $122 trillion unfunded liabilities debt clock — all 15-digits rapidly ticking in real time — at the same corner of the screen?
Perhaps then, when the public is fully aware of the problem, our leaders will be forced into discussing very tough and real solutions followed by legislative action.
But doing nothing is not an option.
What a marvelous idea. Every news network continuously displaying the most misleading piece of crap imaginable, just so the rich can get richer.
How does that make the rich richer? By making the middle classes and the poor poorer. “Rich” is a comparative term. The greater the Gap between the rich and the rest, the richer that makes the rich.
If you have $1 million are you rich? Yes, if everyone else has $1 thousand; no if everyone else has $10 million. It’s the Gap that determines whether or not you are rich.
Widening the Gap is exactly what the rich want. It’s called Gap Psychology: the desire to distance oneself from those below, and to approach those above.
Here are the facts:
1. The U.S. Federal government is Monetarily Sovereign. It has the unlimited ability to create its sovereign currency, the U.S. dollar.
Former Fed Chairman Alan Greenspan: “A government cannot become insolvent with respect to obligations in its own currency.”
Former Fed Chairman Ben Bernanke: “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost.”
St. Louis Federal Reserve: “As the sole manufacturer of dollars, whose debt is denominated in dollars, the U.S. government can never become insolvent, i.e., unable to pay its bills. In this sense, the government is not dependent on credit markets to remain operational.
2. Get it? No matter how much the federal government owes, it simply creates the dollars to pay its creditors. Even if federal tax collections were zero, the federal government could pay its bills, forever.
3. Not only that, but the so-called federal “debt” isn’t a real debt. It is the total of deposits into Treasury Security accounts (T-bills, T-notes, T-bonds).
The government doesn’t touch those dollars, because having the unlimited ability to create dollars, the federal doesn’t need to use the deposited dollars. So these accounts are paid off upon maturity, simply by returning the dollars to their account owners.
Thus, the sole effect (and possibly the sole purpose) of the “National Debt Sign” is to fool you, the public, into docilely accepting cuts to your federal benefits, just as the rich want.
People who use that debt clock sign to “prove” the supposed unsustainability of the federal debt either are ignorant of economics or are being intentionally deceptive.
It’s one situation or the other.
Ask Ms. Adams which is hers.
Rodger Malcolm Mitchell
Search #monetarysovereigntyFacebook: Rodger Malcolm Mitchell
The most important problems in economics involve the excessive income/wealth/power Gaps between the richer and the poorer.
Wide Gaps negatively affect poverty, health and longevity, education, housing, law and crime, war, leadership, ownership, bigotry, supply and demand, taxation, GDP, international relations, scientific advancement, the environment, human motivation and well-being, and virtually every other issue in economics.
Implementation of The Ten Steps To Prosperity can narrow the Gaps:
Ten Steps To Prosperity:
3. Provide a monthly economic bonus to every man, woman and child in America (similar to social security for all)
The Ten Steps will grow the economy, and narrow the income/wealth/power Gap between the rich and you.