Federal Debt, The Way I See It

If the US Government were a family & their household income was $55,000 per year, they’d actually be spending $96,500 — $41,500 more than they made! That means they’re spending 175% of their annual income! So, in 2011 they’d add $41,500 of debt to their current credit card debt of $366,000! – Dave Ramsey

The federal government now has a deficit of over $14,500,000,000,000. Many people are saying we have to solve the problem by ‘generating revenue’ through increased taxes. Take a look at how much EVERYONE in the US makes:

Go ahead and add up all those bars, and lets say we tax 100% of the income from 100% of the people. That is still not enough to fix the problem!

This is a spending problem!

Raising taxes might help a little, but you can’t solve this problem by taxing people.  Taxing people is not ‘generating revenue’, it is taking wealth from a productive person and doing something else with it.  The problem is we are spending too much money.  Simple right?

Now for the real problem(s):

  1. Very few government officials are interested in dealing with the real problem.  (should be obvious now that you’ve seen the argument and RESULT of the recent debit ceiling debate)
  2. Even if they were interested in dealing with the problems, they don’t have the backbone or the brains to resolve the problem.
  3. Most US citizens think cutting government costs are a good idea, until they get to the cuts that affect them; so as a whole, every government program is ‘off the table’.

So here we are, the problem is simple to define but hard to solve!

Mike w/ the NTTP has more information in his recent post Downgrade Causes and Fallout, and many interesting graphs posted on his facebook page.

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