Effects of national debt?
Answer:
The younger you are the more worried you should be. And if you are less than 75 years old you should be worried.
The site listed below is the US Treasury Dept. Go there and you can see that we have never had a surplus since 1959.
Many Americans and politicians will tell you it is nothing to worry about. The only reason it has not been anything to worry about is:
1) The US Fed government has a huge amount of leverage, that is, they can borrow for many decades with no problems unlike an individual. Furthermore, the more they borrow, as long as they have the leverage, the better off the economy is in the short-term and the short-term can be several years. The more they spend, the more goods and services created. But, remember they have been borrowing money each and every year since 1959. Clearly, their leverage is running out.
2) The boomers won't start to retire in the masses until 2010, meaning, so far from 1959 to now our obligations to fund the boomer's retirement has not even yet gone up, the boomers still have not retired...yet.
3) Over half of all the boomers will depend solely on Social Security.
4) Health care costs are going up a double digit rates.
5) The Chinese have stepped in, loaning us more money right when we needed it. But, I'll bet it does not last that much longer.
6) Some boomers have been saving and investing, but once they start to retire there will be a drain on investment, that is, the boomers will start to cash in those investments for goods and services in their retirements.
7) There is no Social Security trust fund, only IOUs from the government. For all of us who have been giving money to the government for our retirement, the government has simply taken the money and made loans to itself with the money and spent the money. Actually, it is very selfish on the part of the boomers: they have allowed the government to spend the Social Security trust fund, knowing that the money would really be needed starting in 2010. They allowed the government to spend the money, which was actually stimulative for the economy during their adult lives, before retirement. That is, they enjoyed the extra spending of the trust fund during their adult lives, but will also demand payment of the trust fund when they retire. So who will really pay, the generation that will be in the workforce when the leverage runs out. It will run out within 10 years, maybe even sooner. So that will be just about anyone less than 40 right now.
Don't get me wrong, the less than 40 workers won't be able to come up with the money, so the elderly will suffer as well. But, it will be the elderly's fault, they are the ones who voted and kept the spend thrifts in office for so long.
8) The way the Fed keeps its books allowed this to go on, that is, Social Security trust fund is an "off-budget item." It does not show up. Like when Bush said yesteday that the deficit this year will only be $200 billion, according to the rules of accounting for the Fed, he does not have to include in that number the money he loots from the Social Security trust fund. If he did, the deficit he would report would be over $500 billion. Sadly, when the media is told this, they shrug it off and continue to allow the politicians to exclude the trust fund from its budget numbers.
Worry you say, yes, you should be worried.
Most likely nothing will be done until it all collapses. Not to mention, that the system created is completely unfair, that is, those who save the most, will get less of their Social Security, those who don't save anything will get the most. For young taxpayers, those who work the hardest to get the highest paying jobs will pay the highest taxes, taxes which will be used for Social Security, and all the low-income programs we now have. Don't work hard in school, if you do you will just pay more in taxes and probably won't live any better than some low-income person who gets help from the government. The young will no longer have a choice, before I had a choice, if I wanted a good life, work harder, study more and I would be equally rewarded. Now, for the young more hard work and more studying will simply get you into a higher tax bracket to help those who were too lazy to help themselves.
Note: the super wealthy should pay, but how our system works is if you make 15,000 you pay about 15% in taxes. If you make 50,000 about 26% in taxes or 11% more. But, wonder you make $100,000,000 you only pay about 35%, only 9% more, and anything over 99,000 there are no more Social Security taxes, Warren Buffet pays no more in Social Security taxes than someone who makes 99,000. The middleclass are pinched to the limit. The middleclass supports the low-income, not the super wealthy as it should be.
And let's not assume that everyone on low-income is there because they are mentally or physically handicapped, that just is not true, most of them are simply too lazy to want to go to school and better themselves.
We should have programs for the mentally and physically handicapped, but not for the lazy ones. We do not differentiate between the two, and we should. THAT IS, WE SHOULD HELP THE MENTALLY AND PHYSICALLY HANDICAPPED, BUT LEAVE THE LAZY ONES ALONE.
Don't get me wrong, if the young want to fit the bill for the boomers in their retirement who allowed the politicians to spend the Social Security trust fund for the last 30 years, and fit the bill for someone too lazy to go to school and do the hard work necessary to get a high paying job, go for it, more power to you.
The united states has been fertilized for the last 200 years.
Now people are growing in the rich soil of indebted citizens feeding the rich like roots to a growing tree.
I am a root that has been severed from a tree, and have sprouted a tree that I will move into before increasing my own root structure and becomming the fastest and largest growing tree on earth. I will purify the skies with my giant branches filled with the greenest of leaves. The Air will become rich with oxygen and be relieved of these pollutants that keep the feild relatively dormant.
We will not wait for the outside world to invade our good soil and use it to their advantage when we have suffered long enough in our own mess that came out of a british rebellion.
We can be a country of greatness.
Of power that is not of a violent nature.
Our money can be the most valuable in the world as we are debt free, and owed money by other countries.
If there is one business in the world that should be utilized by the government, it is the banking industry.
This is because the gov't was given (by us) the sole right to coin money. Our banks make money up out of thin air and use to to make people pay them interest.
Where does the US Gov't distribute funds produced in the mint? How does it enter the economy?
If our government issued all form of loan and credit card, and outlawed any other entity to do such a thing.
If every human alive was provided with EQUAL low interest loans. Im talking 1.2% for everyone. No exceptions.
The government would make incredible "profit" and would therefor NOT HAVE TO TAX US.
At the same time, our government would be feeding the economy, causing a housing boom, and an all around boom in sales for necessity and comfort increasing items.
Some americans would be very very upset by this change, like bank owners and emplyees.
But the Government would only need 1 bank every so often through the States, and each will still need employees.
And just like when a Gov't pays someone for their property forcably to utilize it for new road ways, they could pay off bankers and compensate emloyees with job offers and job finding/career training assistance.
We could all use social security numbers as our credit and money access. People would find ways to "steal" anothers funds, which would lead to some kind of pain free detection method, initiated at birth.
Everyone could be "given" funds through this social # linked account, and the Gov't should be able to afford to provide every US citizen with basic necessities to live.
Then people can work if they want to, to get further in life, and will likely be more free to be creative and benefitial to society at large. School should also be free and improved to include training for living, since parents should be left to be more productive to society and cannot provide the extensive time needed to properly raise a child.
There is so much more...
But yeah, be inspired to make things better. Look for the ways that we could have that utopian society which must be too good to be true.
You have to look at what is relevant. what is the national debt relative to the Gross Domestic Product.
We're 32nd(using approximates/in United States) out of all the countries in the world...
To explain simpler: You, as a person, can afford more debt if you have a higher income. Same applies to countries.
We're okay... don't worry.
You may get your doubts very well clarified from http://moneytips.bestmoneymatters.info... . Best wishes!
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