Smoke, mirrors and the U.S. population
By Randa Wagner -
2.26.13 – People enjoy watching magic tricks, especially when they’re well performed. Most people realize the feat isn’t really magic: it’s ‘slight of hand’ or ‘smoke and mirrors,’ so to say, that make the illusion of someone disappearing, floating in air or being divided in two look realistic.
There are many ways to influence people to see, hear or believe what you want or need them to. If you’re trying to convince them of something that is realistic and true, a common sense approach usually works. You can use logic, facts and history to prove your point.
However, when you’re trying to hide the truth and push an idea or concept to cover up a deception, it gets trickier. It takes a lot more effort to ‘sell’ a lie because you have to take into consideration all the people and factors affected by the lie. If it’s a really BIG lie, you usually have to have other people who have power and influence help you out. As time goes on, you have to keep reinforcing the system supporting the lie to keep it from being discovered. It must get very labor-intensive and tiresome sometimes.
Some people feel this way about the ‘so-called’ recovery in the United States. The ‘new jobs’ and ‘lower unemployment’ numbers the government hands out to the mainstream media paint a rosy picture, don’t they? When the news announces, “Employers create 155,000 new jobs in December,” many of us look around and ask, “where?” When the president announces the ‘economic recovery is here,’ it’s news to many of us.
The U.S. National Debt Clock stated the Outstanding Public Debt as of Feb. 22, 2013 at 6:16 PM GMT was: $16,595,843,364,037.65.
The estimated population of the United States is 314,471,283, so each citizen’s share of this debt is $52,773.80. The National Debt has continued to increase an average of $3.84 billion per day since September 28, 2007.
I noticed at one point on the debt clock, the U.S. Federal tax revenue read $2,487,011,714,061.– but, at the same moment, the U.S. total interest on its loans were higher, at $3,098,580,740,134.–. That means we can’t even pay the interest on our loans, much less our 16 trillion dollar debt.
This explains Why it doesn’t feel like a recovery in an article by Neil Irwin for the Washington Post Business News.
“The nation’s economic woes boil down to this,” he explains: “Compared with a healthy economy, about 7 million working-age people and 5 percent of the nation’s industrial capacity are sitting idle, not producing what they could. The economy is growing again, but at a rate — less than 2 percent in recent months — that’s too slow to keep up with a population that keeps increasing and workers who keep getting more efficient.
“This is the output gap,” he continues, “the divide between the amount the United States can produce and what it is actually producing. The gap, currently $900 billion, explains why we feel so miserable more than a year into what is technically classified as an economic recovery.”
That’s a mild assessment compared to how some budget-watchers see the situation.
In a recent interview at the Vancouver Resource Investment Conference, Jeff Berwick, Founder and Chief Editor of the Dollar Vigilante, said the U.S. financial system is in collapse.
“Most people don’t even see what’s going on,” he maintains. “The U.S. media will always tell you there’s going to be a recovery. There’s no chance of that: it’s not possible. The U.S. government is now 40% of the GDP of the U.S. There’s one in four children on food stamps right now and one in six adults. There’s so much debt, so much government involvement in the economy… there’s 11 states in the U.S. now that have more people on welfare than who have jobs.”
Berwick said it’s not possible for the government to turn the situation around, comparing its status to that of the U.S.S.R. in 1989.
“Our overall debt to GDP is 60%,” he stated.
Imagine if you ran your personal household budget this same way: always spending more than you take in, charging items or services you do not have the funds to support. What happens? Soon you max out your credit line, now you cannot afford anything more than the minimum payments on your credit cards and loans. Interest continues to accumulate, and now you are only paying the interest on the loans. All the while you have to find a way to keep your household operating and functioning. Perhaps it reaches the point where you file bankruptcy, which allows you to begin again with a clean slate, but you can no longer borrow money for anything.
What if the U.S. ‘declared bankruptcy?”
Washington Post columnist Ezra Klein writes, “The choices it (the government) will face quickly become stark. It can cover interest on the debt, Social Security, Medicare, Medicaid, defense spending, education, food stamps and other low-income transfers, and a handful of other programs, but doing all that will mean defaulting on everything — really, everything — else. The FBI will shut down. The people responsible for tracking down loose nukes will lose their jobs. The prisons won’t operate. The biomedical researchers won’t be funded. The court system will close its doors. The tax refunds won’t go out. The Federal Aviation Administration will go offline. The parks will close. Food safety inspections will cease.”
Peter Schiff told Fox Business News central banks are creating inflation so governments don’t have to default on their debts. He believes, based on current trends, the U.S. will have a currency and sovereign debt crisis by 2014.
“President Obama tried to buy our affections by promising more free stuff and by promising the government can solve our economic problems,” Schiff said of the Feb. 12 State of the Union address. “They always tell us how strong we are, how great it is — even when we’re on the edge of a precipice.”
The fact of the matter is, Schiff says, the state of the nation is not strong, it’s a ‘complete disaster.’
“We are staring at an economic crisis much graver than the financial crisis of 2008,” Schiff said Feb. 14. He cites the president as saying we need a little more government to ‘fix’ things: more government programs, more government spending.
“Just about everything he proposed involved more government,” he said. “What’s standing in the way of our economy and prosperity is the government.”
He quoted Ronald Reagan as saying ‘government isn’t the answer to our problems; government IS the problem’ in one Reagan’s State of the Union addresses.
Automatic spending cuts are set to kick in on March 1 if Congress does not come up with an alternative plan to avert them. The ‘sequester’ as it’s being called, involves $1.2 trillion over 10 years in cuts, which were initially set to kick in on Jan. 1 but was allowed a stay of execution. Now time has run out and if an acceptable deficit reduction plan isn’t worked out by the end of the month, the initial phase of the ten-year plan would commence, drawing half its cuts from defense spending and half from non-defense.
I know a man who works for a legitimate business that buys gold and silver jewelry from folks who want to sell it for cash. Having seen ads in the newspaper, I asked him how that business is going these days and if people really use it.
“It’s a very steady business,” he said, “and we get repeat customers. The sad thing is, some people are down to selling heirloom jewelry for rent and grocery money.”
Really? I asked. What happens when they run out of jewelry to sell?
“That’s a good question,” he responded.
I guess the smoke is dissipating for some Americans.
ADDENDUM — Please spend three and a half minutes watching this video by Bill O’Reilly http://www.youtube.com/watch?v=fOxvwOLiPnU