America’s forthcoming entitlement bankruptcy

Posted by John T. Reed on Nov 07, 2018

Here is a comment from a reader at my Facebook Wall and my response

“I think they WANT the dollar to collapse and hyperinflate. Eventually, the hyperinflation would end, and they figure that when it's over, they'll get the kind of government that they want, claiming the old way caused everyone to get screwed, so their way will be the best way moving forward.

“I don't understand the impeach Trump rhetoric however. If they want the dollar and economy to crash, I figured they would want a Republican at the helm. The last time the economy crashed that bad, Herbert Hoover was president. That lead to 4 election wins for FDR, then Truman afterwards. We didn't get a Republican back into the white house until Eisenhower in 1953.”

John T. Reed I do not think they want hyperinflation per se. They do not realize how bad it is, but even their inaccurate notion of it is scary.

But I guarantee that all political parties will seize on any crisis claiming the crisis was caused by their opponents having power and that the solution is whatever the out-of-power party has recently been pushing.

My great fear is that hyperinflation will lead to a takeover of the US government by the Soviet politicians like Bernie Sanders and Elizabeth Warren. Then we probably get at least 70 years of Communism or socialism. And even though the Soviet Union collapsed in 1991, Russia is still a weak sister. I just visited St. Petersburg in August. It was like going back in time.

The solution to the hyperinflation is Libertarian, but the Libertarian Party is not ready to win power. They are too inhibited by their pot head, no military draft anarchist wing. One of the parties who caused the federal bankruptcy will probably seize power because they are organized to win elections. The Libertarians are a feckless debating society.

The eventual hyperinflation stems from the New Deal and the massive expansion of government and the Republicans reluctance to put a stop to it and Republicans often added their own government expansion programs. The public is ignorant of economics, capitalism, socialism, monetary policy. They think big government is infinite freebies for them all paid for by “The RIch.” In fact, even confiscating all the wealth of the top 10% would only fund the deficits for a brief period.

Our current unfunded liabilities for entitlements are about $200 T. That is how much we should have in the bank to pay them. The GDP of the world is about $78 T. Total net worth of all the households in the US is $54 T.

There is no $200 T to give everyone in America free health care and Social Security and federal pensions and disability. At present, when the average person dies, he or she has received three times as much money in health care and Social Security as they contributed to it. This is absurd.

I expect Bernie Sanders will not abandon freebies for everyone until after he has confiscated all the net worth of every household in America. Then we will live in a Hobbesian world until people rediscover capitalism:

“No arts; no letters; no society; and which is worst of all, continual fear and danger of violent death; and the life of man, solitary, poor, nasty, brutish, and short.”

How To Protect Your Life Savings From Hyperinflation & Depression, 2nd edition book

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