GDP measures all output of goods and services for a given year, including all government spending! Uh-oh. So tax collection to our government is the same as vehicle sales to GM and with unemployment continuing to climb, tax collection could be an issue for some years to come. Yet the National Debt continues to climb at a record rate.
Our government’s plan was for growth in GDP (and population) to remain constant for at least long enough for those currently involved in their unselfish service to their country to retire. The plan for growth of the magnitude necessary to service the debt was never mathematically possible.
America has operated on the false footings of ever expanding credit, inflation, and the expansion of phantom monetary capital for 35 years and we are about to pay the piper handsomely for all of the free music. Or should I say, that our children are about to pay the piper?
In my book, “The Biggest Lie Ever Believed,” I wrote that most baby boomers thought that they were going to get out with all of their trappings by passing the debt batons to their children. And I agreed that temporarily, that certainly appeared to be true.
“Appeared” was the key word in the above statement. If you are a boomer, suit up, you’re going in the game. There is only one possibility left for our government to artificially increase GDP and that is with inflation. For those in or near retirement, additional inflation is pure poison.
The only other option for government is to tell the truth. Tell our citizens that our system of exponential growth in a finite world is impossible. And that inflating our money supply and increasing credit and debt is only exacerbating the problem. But Ron Paul tried to tell us that and was branded a kook.
David Walker, the former Chief Comptroller General of the United States, and a personal hero for me, also tried to tell us the same thing and recently resigned his position in frustration.
The majority of Americans will follow the flawed party line politics that have brought us to this juncture to the bitter end. The good news is, we can pack light; it won’t be a long trip.
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