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United State’s Financial Cliff

Posted by Steve Markowitz on August 3, 2012

For years the United States has been on a path of fiscal irresponsibility.  Irrespective of where the funds went or who benefited from the spending, the Country has spent more than it can afford and has been charging future generations for this greedy behavior.  The Country has also made promises for future benefits and payments it cannot afford.  This latter issue involves tens of trillions of dollars that are not included in the Country’s published $16 trillion deficit.

Both political parties are responsible for the financial mess that United States finds itself.  Barack Obama has only accelerated this problem with even greater deficit spending.

Dogmatic Republicans indicate that there can be no increase in any taxes nor will they stand for spending cuts to their pet projects.  Dogmatic Democrats refuse to address the entitlement spending issue, cutting the size of government, and yes also refuse to cut spending on their pet projects.

Ultimately, the bond markets will have their way.  At some point lenders will significantly increase their demand for interest received on loans to the United States.  When this occurs, taxes will increase and services will be cut severely.

The video below offers a simple and concise presentation of the financial problems of the United States.  It helps explain why the politicians in Washington are not able to address the real issues.  No one has ever been elected to office for sharing bad news.

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