Existential debt

On thousand million equals on billion. One thousand billion equals one trillion. One thousand trillion equals one quadrillion.

These figures are from Lawrence Kollikoft of Boston University (a highly regarded source) and are over three years old so they are now much bigger.

Our total debts public and private are over $64 trillion. Our total contingent liabilities (Social Security, Medicare, Veteran’s services, etc.) are $211 trillion. The derivatives (very highly leveraged on the underlying securities are over $2 quadrillion. If leverage equals risk, the risks are astronomical.

The Joint Chiefs of Staff has stated the greatest existential threat to our nation is this. A military is only as strong as the economy underpinning it.

There are three things we can do.

1 - Honor our word. The Congress and Budget Office (CBO) has said this requires a 58 percent tax increase and 36 percent in spending cuts.

2 - Default and just blow everyone off. (Possible but unlikely.)

3 - Use inflation to devalue our way out. Actually this has been going on for over a hundred years but this one will be gigantic. Devaluation and inflation are highly probably. This is another version of default.

Actually we have defaulted three times - in 1780, 1933 and 1971 -but this default will be exponentially greater.

This is an economic problem that only has a political solution. The founders worried about two large things: that ignorant people would elect ignorant people, and once people found they could vote for their own benefit, it would be the end of the republic. This is no longer in the future - it is now. Convince me any of these politicians from either party know what they’re doing.

Marcus Lehmann

Spokane