Unfortunately, this is due to deceit in government accounting that you will NOT hear discussed on any news reports in the debate over raising the debt ceiling.
Let’s frame this somber picture.
President Obama and the Treasury Department are demanding that Congress raise the $16.7 trillion debt ceiling so that the government can continue borrowing in order to pay its current obligations before the October 17 deadline.
The Hill notes that House Republicans plan to tie this potential increase “to a broad GOP wish list that includes delaying ObamaCare for a full year.” Many days of fireworks on Capitol Hill are likely to ensue.
However, $16.7 trillion of debt is actually only a fraction of the total national debt owed by our government. What is missing from the discussion about raising the limit on the government’s “credit card” are trillions in unfunded liabilities with the potential to permanently disable the once great United States of America.
What exactly are unfunded liabilities?
They are payments the government knows it owes which include the future costs of Medicare, Social Security and the prescription drugs of Medicare Part D.
The potentially crippling unfunded liabilities generated from these three programs have their own tab on the doomsday web site known as the US Debt Clock. (Medicaid is NOT included in the Debt Clock’s unfunded liabilities –making the liabilities number EVEN HIGHER.)
What is the US Debt Clock?
According to the organization’s web site:
The Purpose of US Debt Clock.org is to inform the public of the financial condition of the United States of America. We are dedicated to bringing to the public the most accurate up-to-date debt information possible.
If you are unfamiliar with the US Debt Clock it is considered extremely credible and its numbers are widely reported and quoted.
Right now this perpetually moving “clock” indicates our nation’s unfunded liabilities are $125.8 trillion. But in 2017, if current trends continue, the “Debt Clock Time Machine” estimates unfunded liabilities will be boosted to $154.1 trillion. That is an increase of $28.3 trillion in only four years!
Both the current and projected 2017 unfunded liabilities are so mind-boggling for the average American to comprehend, it is best to just ignore them and that is EXACTLY WHAT OUR GOVERNMENT DOES!
Amazing as it seems (and no company would ever contemplate such deceitful accounting) these trillions in unfunded liabilities are NOT itemized on the current U.S. Treasury balance sheet. Even more chilling is that our government knows these obligated payments are on track to smother the rest of the federal budget and coming due soon.
“Coming due soon” refers to a super-sized demographic bulge comprising 28% of the total U.S. population commonly referred to as “baby boomers.” Thus these mounting “unfunded” obligations can no longer be ignored because they are leading to more frequent and larger debt ceiling increases.
Eventually, all the trillions payable to baby boomers through Social Security and the two different Medicare programs — and soon to be joined by Obamacare — will result in the greatest accumulation of debt in all human history.
How DOES the U.S. government wrap its arms around $125.8 trillion of current unfunded liabilities? The answer is “not well” due to that old cliché demographics are destiny.
This specific “demographic destiny of impending doom” started in 2011 when the first crop of 1946 born baby boomers began turning 65 at the rate of 10,000 every day. The pace continues until 2029 when the last group of boomers born in 1964 turn 65.
Our government will struggle to generate enough tax revenue to pay for what is owed and promised, but 76 million rapidly aging baby boomers is overwhelming compared to the number of younger workers paying into the system.
Therefore, in order to keep baby boomers’ benefit checks from bouncing the government will be forced to borrow trillions at an unimaginable pace. Eventually, between the interest on the debt and the benefit payments themselves, there will be no money left in the federal budget for anything else.
Here is what the Congressional Budget Office (CBO) wrote in its 2013 Long-Term Budget Outlook report released on September 17:
The unsustainable nature of the federal government’s current tax and spending policies presents lawmakers and the public with difficult choices. Unless substantial changes are made to the major health care programs and Social Security, those programs will absorb a much larger share of the economy’s total output in the future than they have in the past.
So what part of the phrase “unsustainable nature” don’t you understand?
Obviously, the seeds of our national “demise” have already been sewn because Medicare, Medicare Part D and Social Security are not going to change due to the political climate that currently exists in our nation. For whenever there is talk about reducing or changing these programs, even slightly, a huge national outcry quickly follows.
But everyone knows what cannot be sustained will eventually stop.
Eventually, $222 trillion in debt will cause a steep national decline that could easily lead to civil unrest, a dramatic breakdown of society, or even a total collapse over the next 10 to 30 years.
With this REAL debt ceiling crisis at hand, why do our elected leaders and government officials allow our current federal budget not to reflect and account for these trillions in unfunded liabilities?
Is it because they are afraid to be honest with the American people, especially baby boomers who have paid into these programs for decades?
Do our leaders feel powerless to stop this rapidly moving economic Armageddon?
Or is it just wishful thinking by our government that there will be enough money to pay for all the benefits promised to a defined 28% chunk of the adult population?
(Of course adding to that 28% are millions of Americans born in the 1930s and early 1940s. Although not considered baby boomers they too are living longer then ever before. For example, consider my dear father-in-law, born in 1922 and at age 91 still receiving a hefty monthly pension from that “secret” government agency he retired from in the 1970s.)
If “yes” is the answer to the four questions posed above, the time is now for the American people to be made fully aware of the cataclysmic consequences of these unfunded liabilities deliberately kept “off the books” so that our already severe national debt actually appears rosier.
Perhaps if the real truth were widely publicized about how relatively soon our nation as we now know it will cease to exist – would that supply the proper amount of political motivation needed to inflict radical change upon these deadly, but popular benefit programs?
This “cease to exist” statement is not just the ranting of a fiscal conservative but based on undisputable demographic and economic facts that even liberals are likely to understand.
So remember, during the next few weeks when you hear constant media chatter about raising the debt ceiling from $16.7 trillion to about $20 trillion, what you are actually hearing is “government style” accounting covering only a small fraction of the true national debt.
Meanwhile tick, tick, tick goes the Debt Clock time bomb of deceit, decline and doom.
And if you listen carefully you can hear Jack Nicholson from the 1992 movie, “A Few Good Men,” screaming his famous line, “You can’t handle the truth!”