Financial Reality Is Headed Our Way
Nobel Prize-winning economist Milton Friedman once said, "If you put the federal government in charge of the Sahara Desert, in five years there'd be a shortage of sand." America was once the greatest economic power in the world, and it has steadily declined as the size of the federal government has increased.
The most damaging action by our elected officials is their inability to manage the nation's budget. The U.S. government has racked-up its largest monthly deficit in history. According to the Treasury department, our national debt jumped by $674 billion. The previous record was $223 billion set in Fed of 2011.
The upsurge in debt is the result of Congress approving a spending bill that allowed the government to borrow as much as it wants above the $18.1 trillion debt limit. In October, the Congressional Budget Office reported the U.S. budget deficit in fiscal year 2015 ended Sept. 30 was $439 billion. It was our lowest deficit since 2007. Unfortunately, this claim was a bald-faced lie.
We had actually reached the $400 billion budget deficit mark in early March. Because our debt load was right at the $ 18.1 trillion limit, Treasury Secretary Jack Lew started using accounting tricks to keep the government funded. The actual deficit for the fiscal year was around $1 trillion. It is easy to figure out because the government tells how much of a deficit it runs each month, which is around $90 billion.
What has allowed for this crazy math is the lack of any watchdogs. We've become so acquainted with massive deficit spending, we no longer fear the consequences. When a problem is neglected, it will most like get worse, and that is exactly what is about to happen.
Medicare/Medicaid is the largest federal budget item. When it was first created in 1965, the program had an annual cost of $10 billion. By 1990, the cost was $200 billion; by 2011 it was $671 billion, and here in 2015, we have just reached the $1 trillion milestone.
Medicare/Medicaid has grown 100 fold since it began, and it will continue to mushroom in size. By 2019, Medicare/Medicaid's cost will reach $1.5 trillion and it will be at $2.0 trillion by 2024.
Social Security is another program that is growing out of control. Its annual cost is $944 billion, and by 2019, it will reach $1.2 trillion. With 10,000 Boomers retiring each day, the cost of Social Security with rise sharply for the next two decades.
This past summer the Disability Fund which is part of Social Security ran out of money. Congress fixed the problem by combining Disability with Social Security. Since Social Security was supposed to be a savings account for everyone's old age, this action proves the whole program is one giant Ponzi scheme.
The most boneheaded move by Congress would have to be its plan to sell 58 million barrels of oil from the Strategic Oil Reserve (SOR), the U.S. oil stockpile designated for drawdown only in case of an emergency (national security or national disaster-related). The oil is being sold over a six year period and the $5 billion raised will be used to help fund the government. Here are four things wrong with this plan:
The oil is for war or a national disaster.
This oil was purchased above $70 per barrel, and spot price now at $42.
The $5 billion amount is based on a forecast of oil rising to $94.
Most of the money raised will be used to upgrade the SOR facilities.
We don't need multi-trillion dollar deficits to prove that the government is bankrupt. The system was insolvent years ago. The great mystery is why there has not been a meltdown of the financial markets. To find the answer one needs to turn to Bible prophecy.
The Rapture is going to be the most shocking event in human history. The Bible predicts that everything will be perfectly calm the day Jesus comes back for the Church. God is setting the stage for the Rapture which may be the only logical reason for why faith in the dollar remains solid. Once the Blessed Hope occurs, the hand of stability will be lifted and the world will be plunged into financial chaos.
"Watch ye therefore, and pray always, that ye may be accounted worthy to escape all these things that shall come to pass, and to stand before the Son of man" (Luke 21:36).
- Todd Strandberg -
