Economic Armageddon, Here We Come

by Marty Nemko
by Marty Nemko

Obama administration admitted today that the federal debt will, over the next decade, grow wildly larger than it had previously said – so much for a recovery. Now the estimate is $9 trillion!

And that doesn't count the $1.0 to $1.6 trillion Congress is contemplating spending on ObamaCare.

Nor does it count the massive additional new spending Obama has promised; for example, legalizing the 13–20 million illegals, who will thereby become eligible for ObamaCare, increasing the debt further.

And Obama is considering "Stimulus" 2. For our trillion dollars, "Stimulus" 1 has resulted in increasing unemployment and increasing debt, yet he contemplates Son of Stimulus.

China owns ever more of America and the U.S. is becoming ever less creditworthy. The amount we have to pay just in interest, is approaching the total budget for national defense!

And federal spending is accelerating?! Will we, not to mention, our children, and grandchildren, suffer profoundly from our profligacy?

Government programs (yes, Republican-initiated programs, for example, the Bush bailouts and the Iraq War, are equally at fault) are usually terribly inefficient. Think Amtrak, the Postal "Service," the public schools, the nearly bankrupt Social Security and Medicare, the Bailouts, $75 hammers, the Bridge to Nowhere.

Many government programs are actually negative in effect. Consider, for example, Cash for Clunkers: dangling taxpayer dollars in front of people poor enough to own bad-gas-mileage clunkers so they can go deeply in debt to buy a new car (80% of which have been foreign, by the way). And of course, dumping all those cars and their toxic components and fluids into landfills is an environmental disaster. Plus, car dealers are screaming that they have laid out the $4,500 per car to customers and often have not yet been paid by the government, thereby killing their cash flow, a business's lifeblood. The government can't even write a promised check in a timely manner and they want to run a "public option" health care system?

An individual and especially a nation in debt is at-risk. A nation that has assumed unprecedentedly, incomprehensibly mammoth debt is doomed. Even Keynes did not imagine this magnitude of government spending. To pay for its metastasizing number and scope of programs and interest on its soon-to-be $9 trillion debt, the government will, unchecked, continue to raise taxes and print ever more money, thereby decreasing the value of our life's savings and purchasing power.

As a result, American workers will likely end up joining most of the world's workers in earning a net $1 an hour. According to the Center for Fiscal Responsibility, we already work into August just to meet all the costs imposed by government. Does anyone really think we get fair value for the government's taking over half our money from us each year?

Our only hope is for us to demand that the government return most of our tax dollars to us and for government to live within its then more modest means: scale down so it can balance its budget and pay down its debt. Anything else leads us to economic Armageddon.

August 26, 2009

Dr. Nemko [send him mail] is a career counselor in Oakland, CA and host of Work with Marty Nemko on KALW-FM (NPR, San Francisco.) 500+ of his previously published articles and columns are on MartyNemko.com.

Copyright © 2009 by LewRockwell.com. Permission to reprint in whole or in part is gladly granted, provided full credit is given.