Two recent events were undeniable… arithmetically indisputable, good news on the economic front. These of course were the rapid growth in Q4 of last year and the recent crash through the dirty-glass floor of double-digit unemployment. Gold prices are well down, oil is up but it seems that is mostly currency fluctuation. That’s good stuff. However public opinion is unimpressed. The recent spike which seems was captured only in Rasmussen’s robo-called three-day rolling average has endured scarcely a week. Even the Obies are going easy on the trumpets. So what is up? It’s quite simple. Everyone paying attention now knows that whatever blurps and blips take place in the short term, economically at least, we are fully and truly screwed.
That’s not the same thing as you or me being financially screwed, that is more subject to your daily habits (and the volatility of a screwed economy offers tremendous opportunity for those who know she is screwed, and how). But in large scale terms and for the nation and world at large, the deed is done. No, the dastard is not Obama, or at least not merely him. The culprit is a set of presumptions and interlacing stupidities that reinforce one another that reside within the national id. There is only one cure: Reality and plenty of it. This is a bitter medicine but the only course, here is why.
We shall indict some actions of the Obamistration but there is little doubt that President McCain would behave quite similarly. The muddy fingerprints of the Bushies also should not be ignored; nor the Clintons, nor Carter, Reagan, Johnson, the Democrats, the Republicans, the financial wizards, the press flunkies nor Joe/Jane Blow nor you. Nor me. We have been many decades persistently stumbling towards ruin.
You had best sit down.
At the turn of the year the payout rates from Social Security are determined, rising over the years as inflation has risen. This Cost of Living adjustment happens automatically and compounds so as inflation increases the checks bet bigger and feed inflation, which grows the payouts… is there anyone missing the lesson? Not for long because SS is a tremendous part of our national debt, yet it is not included in most public figurings of the national debt. Currently that figure is about 1.6 trillion dollars, shocking eh? But the total liabilities for SS are easily 17.5 trillion. Yup. All they are talking about as the “Budget” does not consider the ever rising costs of Social Security or its total burden that is 10 times the nominal federal pie. As if that weren’t enough the Cost of Living adjustment actually was not made this year. Why? Was this an attempt at cost control? No. It was yet another example of Too-Big-To-Failism. Since there was a touch of DEflation the checks would have been cut a tiny amount to reflect lower living costs but we can’t have the Golden Girl crowd enraged in the streets… or at least not more than they already are, so the Obies pledge to send out consolation checks to the tune of $13 billions. And is there anyone who objects to this on practical, principled or even arithmetical grounds? Ah, hell no, least of all McCain. And if you were in the Congress or press, you wouldn’t do it either. It is baked into our national character: Grannies are sacred and justly so, but this simply cannot persist. Only utter collapse of the system will cure this wasting disease. Luckily the wave of early retirements of the Great Recession make this inevitable quite shortly.
And if Social Security is bad, Medicare (medical coverage for the elderly) is much, much worse if only because it is much, much bigger still. Yes, some 90 trillions are committed to Medicare, Medicaid (coverage for the poor) is not far behind at 86. Of course the President is working on a solution to this problem, somewhat famously. Cost control is perpetually said to be a foremost concern, very good, but AFTER expanding federal medical coverage of some sort to 30 millions AND extending that coverage back in history to cover the costs of people who are ALREADY ill. This may be a moral or emotionally vital action, but cost saving it is not. No how, no way but even if, miraculously, O-care just kept costs on the same path it would still lead to the same place. Utter collapse. Meaning? Meaning Medicare checks will bounce or the Treasury printing presses will fill the gap. President Obama reminds us often that the Bushies added a prescription drug benefit to Medicare, adding titanically to its cost. True, all true, although this version leaves out the enthusiastic participation of the Democrats (and does anyone think that Obama would have opposed this in the Senate? For reasons of fiscal restraint?). So Republicans are most emphatically NOT the cure for this disease. Nope. Likewise whether or not O-care passes, whatever its form, is immaterial. It might amount to a slight easing off the gas when you are already going 90 and headed for the cliff. Not an improvement.
Add it and weep, friends. Yes, the actual total national debt is about 200 trillions before you even figure in the operating budget which amounts to less than 1% of the total. And these projections assume a 3-odd percent rate of growth which we ain’t got and are unlikely to see so these total debts, nominally, could easily DOUBLE in the next few years absent serious reform. The illustrated perversions above also obtain in all other actions of gub at all levels. The states are all also in the same sort of pickle. Their entitlements, pensions and practices are as viciously circular as anything in Washington with very few exceptions. The inevitable will occur though, these obligations will be repudiated. If they are not addressed through some serious cuts in payouts, and they will not, they will have to be degraded through inflation. Except the payouts are indexed to inflation, remember? This describes nothing so much as a fiscal black hole. Only monetary collapse can ensue. That’s it, it is done and most of it was done before Barack Obama ever came to the Senate, although he rode the wave as much as anyone.
Okay, so what? It is only money, which is nothing but paper, right? The true assets of the nation and the world reside in the backs, hands and minds of you and me. This impending tsunami of necessity will drive us to do our best and to do our most, something as alien to doofs of my age as an iPad would be to a cowboy. It will be done and friends, it will be fun! Sure, we might live on Ramens here and there but that mother, Necessity and her bitch of a mother, Reality will again be tamed and we of this nation and we of this world will go forward without these ever-spiraling burdens at a pace that will make all other booms pale in comparison. Oh yes, that is also inevitable. So cheer up! It’s been all over for years.