U.S. financial system unsustainable
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Editor,
In college in the ‘50s, I was taught that, historically, no government structure was permanent; all would change in time. Furthermore, transition periods could be pretty bloody. Could this actually happen in the USA? I believe so, and here’s why.
We have a very high national debt, about $20 trillion. We also have unfunded liabilities of over $70 trillion. The debt keeps increasing every year because of deficit spending. We have few statesmen and many, many politicians at both the Federal and State level. (If you want to know what a statesman is read biographies of Washington, Adams, Jefferson, Lincoln and Grant.) Politicians are driven primarily by the need to get reelected, ie., to get votes. They do this by doing favors for money sources, making promises that they can’t keep, and by giving voters free stuff (i.e., entitlements). The result is that deficit spending just keeps going on and on.
As higher and higher debt turns over and needs to be added to and replaced, there is continuing pressure by buyers to obtain increased interest rates. As the Federal Reserve (which now holds $4 trillion of the national debt) buys new debt instruments to keep rates down, it must print money to do so, adding to the money supply. These factors combine to cause inflation.
This is an unsustainable system and will eventually lead to a total collapse of our financial system. There will be widespread economic damage and violence in our urban areas. I will not see it in my lifetime, but I believe that my children and grandchildren will.
What to advise them for this difficult future? The only thing that I can come up with is to get some property away from the big city and learn how to live off of it. I guess Thomas Jefferson was right.
Jim Loebbecke
Polson
