The Federal Government keeps its books in a way that would send any private business to jail. In the near future, Social Security, Medicaid and Medicare are going to be consuming much more in resources than the taxes collected to service the programs. The current national debt is $12.46 trillion, (I would put all the placeholders for effect, but I can’t type as fast as it moves), that is compared to a GDP of $14.3 trillion. Not pretty huh? If this was it this would be a bad problem, Think of it, if you have credit card debt of 87% of your income you are in pretty bad shape.
However, now for the really bad news– The total unfunded liabilities of the Federal Govt. is $107.6 trillion! This includes the cost of future social security payments, as well as health care and drug costs for the life of American retirees. The interest on this debt (so far this year) is $36 billion. This amount is staggering. Think about this- If I am an individual who has $107,000 in credit card debt and I only make $14,300 a year, I have a very big problem. As the years go by with this, and as more citizens retire and start collecting Social Security/Medicare, we will have to quickly and drastically increase taxes and cut benefits for all the citizens who have paid into this system their entire lives with the expectation of benefits in retirement. This is the problem with doing all this on a federal scale. If only one state had endeavored on this course, citizens could have fled to more responsible states rather than endure the pending wholesale theft, but people cannot flee the Federal Govt. without giving up the freedoms that are promised here.