Is the USA Too Big to Fail?
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Thread: Is the USA Too Big to Fail?

  1. #1

    Is the USA Too Big to Fail?

    Is the USA Too Big To Fail?
    By Alan Caruba Sunday, May 2, 2010

    Lately I have been playing with the question, is the United States of America too big to fail?

    Greece’s bonds are now rated as “junk.” It will have to be bailed out with billions from the nations of the European Union, but Portugal is not far behind and so are Italy and Spain. Iceland went belly-up months ago. Meanwhile, the sovereign debt of the United Kingdom, plus the assets of its five largest banks, exceeds 500% of its gross domestic product (GDP)!

    According to Forbes, in the United States the total federal debt, including debt held by government agencies like the Social Security fund has ballooned by 50% since 2006 to $12.3 trillion. The U.S. government debt-to-GDP radio is 84%. A tipping point into default is generally believed to be 90%.

    Can the whole financial system be gamed? Well, yes. On September 15, 2008 there was a suspicious, coordinated withdrawal of $550 billion from American banks just before the end of the 2008 election campaigns. It forced the Federal Reserve to shut down the drain of funds leaving the nation.

    Within days the then-Secretary of Treasury, Henry Paulson was asking Congress to cut him a blank check for billions in order to stave off the collapse of major financial institutions. Subsequently, one of them, Lehman Brothers, was allowed to fail while a forced marriage between Bank of America and Merrill Lynch ensued to keep the latter from failing.

    Troubled asset or TARP funds were dispensed and repaid. It’s hard not to make a profit when the Federal Reserve is lending you billions at zero interest rates.

    It is now official White House policy to berate Wall Street and threaten it with a ruinous expansion of regulation. Others considered enemies of the state by the Obama administration include insurance and pharmaceutical companies, along with producers of oil and coal.

    The whole world of central banking is deliberately murky to the outsider. I have no idea how it works except that their first imperative is to remain solvent so that the sovereign entity they serve remains solvent as well.

    That is not easy in an era when most nations have socialist regimes requiring very high taxes with which to redistribute their nation’s wealth. This is further complicated if the nation’s population is aging as is the case throughout Europe. America is aging too as the Baby Boomer generation begins to reach 65.

    In point of fact, Social Security, the oldest Ponzi scheme in town, is now taking in less money than it is paying out.

    Ironically, an element of this aging is the fact that America has had a remarkable healthcare system that has contributed to expanding average life expectancy to 78 among men and over 80 among women. That will change if Obamacare is allowed to make the rules. Old people will become expendable.

    The other Ponzi scheme is Medicare and Medicaid. They are expected to go broke in about eight years or so. All of the billions collected from income taxes every year now go to Social Security, Medicare/Medicaid, and to defense spending. To pay all other government expenses, the money must be borrowed.

    When you “reform” Medicare as the Obama administration and the Democrats in Congress just did and it turns out that it is going to cost billions more than the former system, you have to wonder about the depths of stupidity involved?

    A child born today arrives with a debt of $30,000. To secure a college education, the average expense is around $100.000. Life in America is going to be ruinously expensive, including for the 40% of Americans who pay no income taxes.

    Beyond the borrowing and spending is another factor that is being ignored or undermined. The nation requires a dependable supply of electricity to keep EVERYTHING going. When the electricity stops, the nation will stop. It will be unable to function. Computers, the banks, the trains, the airlines, the supermarkets, gas station pumps, television, heating and cooling systems, elevators….EVERYTHING.

    This is hardly the time to be lavishing billions in federal subsidies on dubious “clean energy” systems such as wind and solar, but that is exactly what the Obama administration is doing.

    The reality is that coal-fired, natural gas and nuclear energy generates 88% of the electricity we use. We need more, not less, as our population increases.

    At what point do Americans begin to ask why the Obama administration:

    •Has imposed a very expensive overhaul of the nation’s health system,
    •Is opposing the development of traditional sources of electrical power and for transportation,
    •And is attempting to impose the biggest tax on energy use (Cap-and-Trade) in the nation’s history.
    Perhaps the worst idea is a VAT (value added) tax that will affect every purchase of, well, everything.

    At what point will the economy of the United States of America simply fail under this very unpleasant set of conditions? The answer in part is when other nations decide not to buy our treasury notes.

    The United States has gone from the greatest economy the world has ever seen to being a creditor nation whose currency is in danger of being devalued.

    I don’t like thinking about such things. No one does, but someone must.
    Conservative Wife & Mom -- I'm a Conservative Christian-American with dual citizenship...the Kingdom of God is my 1st home and the U.S.A. is my 2nd.

  3. #2
    Join Date
    Dec 2009
    I just love some good FUD on a sunday afternoon. God bless you mom.

  4. #3
    Quote Originally Posted by theicemanmpls View Post
    I just love some good FUD on a sunday afternoon. God bless you mom.

    Once again the pity party idiot shows up.
    By faith Noah,being warned of God of things not seen as yet, moved with fear,prepared an ark to the saving of his house;by the which he condemned the world,and became heir of the righteousness which is by faith Heb.11:7

  5. #4
    wolfhunter Guest
    A request was made that the vulgar term "FUD" not be used on this site any longer. The continued use of the term indicates a lack of vocabulary while demonstrating total disrespect to the other posters.

  6. #5
    I am sorry but every thing this troll posts shows a lack of vocabulary while demonstrating total disrespect to the other posters.
    By faith Noah,being warned of God of things not seen as yet, moved with fear,prepared an ark to the saving of his house;by the which he condemned the world,and became heir of the righteousness which is by faith Heb.11:7

  7. #6
    Join Date
    Dec 2009
    Quote Originally Posted by wolfhunter View Post
    A request was made that the vulgar term "FUD" not be used on this site any longer. The continued use of the term indicates a lack of vocabulary while demonstrating total disrespect to the other posters.
    Wolf, was this a direct request of the site admin?
    I was under the impression that name calling was not allowed here. What is your take on that one also wolf?

  8. #7
    handgonnetoter Guest
    I'm new to this forum and this is the only forum I belong to, but I can see that this topic has got people at each others throats. I think we are all on the same side here. What the heck does FUD mean anyway? Acronyms drive me nuts anyway. I understand what she is getting at with the original post. I think the real problem is going to come about via our economy. Things like "socialistic" plots and gun control will come about by the anti-gun crowd claiming the "economy" is why we need tight government control over everything. When things are going good and all have decent jobs and some money in their pockets, nobody really want ANYTHING to change. I feel that the original post she made is only trying to bring out ONE of MANY ways others are going to take control of every aspect of our lives. Just the opposite of what our founding fathers would have wanted.

  9. #8
    Join Date
    Apr 2010
    South Central N.Car.
    Am a newbie here also but his term is a new one to me and I have been around for quite awhile at other sites. Either way it is not wanted, has been asked to stop, and should out of common courtesy.
    Now, back to the thread: Rome thought it was too big to fall also. Just as did every super power throughout history. England had a term--"the sun never sets on the British Empire"--- that is because they had properties and military might on every continent. Sound familiar??? As for the economy--- it has been broke for many yrs. It just has not fallen apart yet. The other countries will dump our currency at some point and when that happens the house of cards will come crashing down with deafening sounds that will reverberate around the globe. These FRNs are useless without the confidence of those using them. Do you trust them--didn't think so.

  10. #9
    Join Date
    Jul 2009
    South Carolina/Charleston
    In a word "NO". Start learning your chinese boys and girls--they own us lock stock and barrel. If there is a yes answer it is only because the chinese have nowhere else to sell their crap to.

  11. #10
    FUD = 'fear, uncertainty, and doubt' Something those who buy what the authorities tell them are well used to. But, I guess if you need to make up swear words to hate people for you can always continue to ignore facts.

    The OP is correct, many of the programs the US has followed for many years will be unable to continue into the future. That hasn't stopped anybody from supporting those programs and hoping a way will be found by whoever gets the responsibility next will figure something out.

    So, NO, the USA is NOT too big to fail. No nation in history has been 'too big to fail' .

    BTW ( 'by the way' for the acronym challenged) It's cute to see y'all complain about your 'troll' while you insult and call names.
    People don't like to be meddled with. We tell them what to do, what to think, don't run, don't walk. We're in their homes and in their heads and we haven't the right. We're meddlesome.--River Tam

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