Your Turn: Can America Go Broke?

Daniel L. Gardner

Guest Columnist

I don’t know anybody who believes America could go broke a la Iceland, Greece, or the former USSR. But, a lot of conservative economists – whom I don’t know personally – continue to say if Washington continues to spend trillions of dollars more than we raise in revenue annually, America will go broke. Nobody wants to think about what that may mean for our society.

Can America go broke? Nobody believes that. We’re America, the most powerful nation on earth! We have more resources than any nation in history! We are too big to fail!

But, what if we could go broke? What does that mean?

When a person goes broke, he loses everything…his home, car, and assets; anything of value is taken away from him through bankruptcy.

When a business goes broke, banks and creditors sell assets, close doors, and all workers go looking for other jobs.

When an international company with hundreds of billions of dollars goes broke, Washington pumps huge sums of taxpayer dollars into the business to bail it out, and CEOs and upper level management get hundreds of millions of dollars in bonuses.

This is America! Capitalistic opportunities abound for those with connections in Washington.

What is ‘broke’ anyway? Is that when one owes more than one owns? Or, is ‘broke’ when one owes more than one could ever reasonably repay?

Consider the following current fiscal year numbers:
National Debt – $12.5 trillion
National Deficit – $1.4 trillion
Medicaid/Medicare Spending – $762 billion
Social Security Spending – $682 billion
Defense/War Spending – $662 billion
Interest on Debt – $190 billion
Federal Tax Revenue – $2.1 trillion

(Note I’ve spelled out billion and trillion because newspaper columns aren’t wide enough to incorporate whole numbers.)

Washington has spent $3.5 trillion dollars so far this fiscal year. We have already spent $1.4 trillion dollars more than we have brought in. If Washington were an American household making $50,000 per year, we would have made nearly $21,000 to-date, and we would have already spent $35,000.

While we’re looking at our credit card bill of $14,000 not counting interest, our spouse suggests we could save money by buying more health insurance now to offset costs we expect to have in 20 years.

They say money disputes are the leading causes of divorce in America.

America has unfunded liabilities of $108 trillion: we have taken money from taxpayers to pay for Medicare, Social Security, and Prescription Drugs, and we owe $108 trillion more than we have collected so far for just these three entitlements.

If America were broke, Washington could not send checks to pay for Medicaid/Medicare, Social Security, Unemployment, Food Stamps, Welfare, or any other entitlements. Washington could not pay federal employees – including military – or retirees.

America is broke. We are bankrupt. We can’t save money by spending more money. If Washington collected 100 percent of every paycheck in America, we could not put a dent in the debts we owe.

President Obama wants to spend $1 trillion on healthcare reform, creating nearly 200 new bureaucracies in Washington ‘to save money.’ Taxpayers will have to pay higher taxes to pay for this new spending.

Every paycheck in America will see larger deductions for Federal Income Tax, Social Security, and Medicare, not to mention state and local taxes. Plus, taxes will go up on everything we buy.

Washington should cut spending now and balance the budget.

Daniel L. Gardner is a syndicated columnist who lives in Starkville, MS. You may contact him at PJandMe2@gmail.com

His column does not reflect the views of Starkville-Now.com.