Thursday, August 05, 2010

Sudden-death economics ~ By Herman Cain

I would have had The Hermanator's column posted here a couple of days ago, but found myself dealing with a crashed hard drive instead. Fortunately, Herman's column was not time-sensitive, as he is writing about a situation that is on-going.

Or, perhaps the hard drive catastrophy was just my excuse so I could put off the posting of this column, for the fact that it is a scary topic. And I don't think that would be the only person around that wants to avoid what may be imminent and present danger to this country. I am not sure if many people have really considered what could happen to America should there be a financial collapse. But, if you think about it, should the economy of the United States collapse, I am sure the global economy would be quick to follow. And that is the very scary part of the potential financial collapse, a very possible scenario.

And knowing what I know about economics, I am wondering how the people running the government could not possibly understand what is facing this country economically. I would think that they would know that history shows that tax rate decreases have actually led to an increase in revenue (see "The Historical Lessons of Lower Tax Rates" which Herman links to in the FULL column). It is why I still hold the opinion that Obama and his administration DOES know what is going on, and that it could only be an intentional attempt to destroy this country - for what ever sinister reason they may have. Just sayin'...

Admittedly, this is not an inspiring or entertaining topic. In fact, it is downright scary. It is even scarier that a large number of voters are equally oblivious and blind to this clear and present financial danger. What happened in Greece and other European countries can happen here.

The big difference is that Uncle Sam does not have a "sugar daddy" to bail us out.

The 2010 congressional elections are sudden death for control of the House of Representatives. If real Republicans take control, there is some real hope of slowing down the destruction of our economy.

This is a serious crisis, and the elected so-called leaders are not listening. I believe the voters are listening. They will remember in November.

By Herman Cain

Posted: August 02, 2010 ~ 1:00 am Eastern

© 2010

Our economy is on a government-induced lose-lose trajectory of financial destruction between federal spending and tax revenue. It's a Mathematically Assured Depression (MAD). The only unanswered question is when.

– Herman Cain, March 9, 2009, commentary
I do not enjoy bad news predictions. But the president, his administration, Congress and the major mainstream broadcast media are focused on everything except the coming financial disaster we face. It's not that the other issues are not critical. The financial crisis could be catastrophic.

The Congressional Budget Office issued another warning last week that the growing federal debt is unsustainable! It is a real crisis! As stated in the agency report, "A growing level of federal debt would increase the probability of a sudden fiscal collapse."

This did not just start under the Obama administration, but it has clearly accelerated during this administration. Consider the following statistics:

When President Obama took office in January 2009, the national debt was $9.5 trillion, which is nearly $32,000 for every man, woman and child living in this country. The national debt as of this writing is nearly $14 trillion, which is $45,000 for every man, woman and child living in this country. That's a historic increase in a historic short period of time!

That debt does not die when we die. Our children and grandchildren will have to pay our foreign creditors back, if we can avoid a total financial collapse.

As the president and Congress continue to spend like crazy, they continue to pay lip service to wanting to get spending under control. Their words do not match their actions.

For example, Senate Democrats tried to pass a $30 billion "drop in the bucket" package to help stimulate lending to small businesses. More than $600 billion of the stimulus bill has not worked, so the Democrats wanted to throw another $30 billion on top of the $846 billion stimulus spending. The majority of Republicans voted against it because it was new spending, when the money could have been taken out of unspent stimulus funding.

Of course, the president blamed the Republicans for being partisan obstructionists.


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