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Longboat Key Wednesday, Sep. 12, 2012 3 years ago

Our View: 'The Debt Bomb'

by: Observer Staff

It’s about to explode.

No one knows exactly when, but every day Congress and the president refuse to CUT spending meaningfully — actually reducing spending below the previous year — the the explosion grows nearer.

Pardon us. We know many of our readers prefer we stick to local matters here, but there is a domestic war going on, and none of us should sit idly by — the way they do in Congress. Our freedom, our way of life is at stake and on the verge of calamity.

To see this picture clearly and understand it in layman’s terms, read “The Debt Bomb: A Bold Plan to Stop Washington from Bankrupting America,” by U.S. Sen. Tom Coburn of Oklahoma.

Talk about a reality show. Coburn spells out where we are (see charts) and what is going to happen on that day — when foreign governments and investors stop buying our government debt. And they’re going to stop, be assured of that. Writes Coburn:

“In 2022, tax revenues will only cover the cost of Medicare, Social Security and interest payments on the national debt,” Coburn writes. “We’ll simply have nothing left to fund every other function of government. That means we’ll have to do one of three things: 1) Shut down every federal agency and scuttle our aircraft carriers; 2) Borrow a couple trillion dollars every year to fund the other government functions — if we can even borrow the money; or 3) Enact massive tax increases, which will further slow economic growth.”

And that hardly explains the economic catastrophes that will affect every U.S. family when the bomb explodes. Your savings and assets will shrivel to a fraction of their current value; the value of the dollar will shrivel; inflation will be unbearable. You should be watching Greece. That’s just the beginning.

And let’s be honest about something: As the chart above explicitly depicts, the U.S. is in this predicament because of Republicans and Democrats alike. They are equally to blame. Presidents and Congress alike. Congress, after all, controls the purse.

When Barack Obama last week begged for four more years to fix the U.S. economy, we thought: Get real. In business, any CEO worth his pay and facing the crisis that faces America would have taken to cutting expenses with a vengeance on Day One! When the life of the business is teetering, an effective CEO acts decisively. If we are to win this war, we need new leaders with the moral conviction to act NOW.



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