Is the U.S. Economy Headed for Collapse?
Last week the United States federal debt surpassed the $19 trillion mark. Almost half of that has accrued since Barack Obama took office in 2009, highlighting the exponential growth rate of our indebtedness. While it is true that both the Democrats and the Republicans are responsible for this national disaster waiting to happen, it is the spending frenzy of the left that has pushed us to the brink. In 1980 the federal debt was about 30% of the Gross Domestic Product (GDP or total value of goods and services produced by the people of the United States during a year). The federal debt has now surpassed 100% of the GDP.
Borrowing from China to Give Aid to Pakistan
It is of grave concern that foreign countries, not necessarily friendly to the United States, are loaning us money so that we can pay for all the goodies and then collecting interest on that debt. In 2015 the United States paid $223 billion (more than 6% of the federal budget) in interest on the national debt. As interest rates rise and we borrow more and more money, the amount of interest we pay will go up significantly. If you are not happy that your hard earned tax money is given as foreign aid to countries like Pakistan, consider this. Now, your taxes are going to pay for the interest on the money we borrowed from China so that we could give it to Pakistan!
Irresponsible Mismanagement of the Federal Budget
This reckless and irresponsible mismanagement of the federal budget simply cannot be sustained. Many wonder if the recent wild volatility of the stock markets could be a harbinger of impending economic collapse in the United States. If and when that time comes, it is ironic that a new, fiscally responsible Republican president could be blamed for it if it occurs during his or her term in office. With so much at stake, is it any wonder that many Americans are sheltering their money in UTMs*!
*Under the Mattress