Bernanke has warned that rising entitlement obligations will put enormous pressure on the federal budget in coming years, which may lead to rapid growth in debt and interest payments. Bernanke added, "If early and meaningful action is not taken [to lower the budget deficit], the U.S. economy could be seriously weakened."
More "wind song", if you ask me. On the one hand, he warns but contiues the "liquidity money pump"... just as he did with "raising rates on one hand", while "pumping up the repo market with the other hand' at the same time.
Bush has been warning about this since the start of his election and was ignored on both sides of the political isle to his own political loss. No one wants to address the entitlements problem because so much of our economy that produced those entitlements came from government jobs and spending. Senators and Representatives are afraid of getting the boot for even suggesting to constituents about the need to reduce spending programs or cutting back government (e.g. reduce postal, social, judicial, DOD, NASA, HUD etc. etc. ad nauseam and retirement pensions/benefits ) or veteran benny cutbacks etc. So we have a no-go political quagmire that can't pragmatically be resolved until the country deteriorates to the point of anarchy and people refuse to be taxed on wages and stop working. As it is, it's too easy for people to put there hands out and take and whine for more - so why work and why be taxed for effort if anyone talks of reducing benefits? Clearly, baby boomers are going to be screwed out of their entitlement share. That's the only possible answer unless someone manages to use smoke and mirrors to push the debt to the next generation again. Ponzi schemes were suppose to be illegal but our gov uses them as major national policy. So kiss SS goodbye forever if you have managed to put together a modest 401K or IRA since there will have to be a means test. How else witll the US be able to afford to gives benefits to Mexican illegal immigrant's babies/healthcare/education etc.? It's clear now that we don't have the low cost labor pool in our legal domestic population to continue the economic expansion. Cheap labor needs to be imported and they are not going to be screwed out of their entitlements (thus the game of coming here and making babies as naturalized US citizens as fast as they can). The only other answer to the entitlements delimma is a mass "event" that balances the books in one fell swoop - maybe a large natural disaster or war that gets the excess liability zeroed from the books. Yeah - early death. :eek: Our parents sold this country down the river long ago when it traded its freedom for the false promise and of a "womb to the tomb" protection that was implied in the social security lie. Itâs only expanded into a frankenstein from that original freedom cave-in. Something has to give soon on the political front, or the money front or the currency and economy fronts. I am normally not in the doom and gloom crowd but I see no way out of this budget entitlement problem without radical revolutionary change. And yeah that implies emotion, conflict and bloodletting to get the deeply committed and attached parasites out of the system. That also means much smaller government and most likely an entire change in government form. No democracy will ever willfully vote to sacrifice or reduce its power and spending that it can steal from its treasury and people. I expect the ultra wealthy to bail out of the country and vacate wealth when it gets close to "the time" for events to unfold. Reason? Itâs traditional to plunder and hang those with the money and blame them for all the world's problems and they are the only ones to go after for wealth. TS
you're not talking about bush the tax cutter and unprecedented spender are you? it's almost like him saying 'guys, we need to do something urgently about the problem i've massively accelerated in my time as president'
Let's try to keep this non-political shall we? We have a huge problem that has been going on for decades - its not a recent problem. I think Reagan was even talking about the growth of entitlements in his day and warning that it was enevetible that pensions/medicare/social security would become the ENTIRE budget within a majority of people's lifetimes. Besides, last I checked congress, not the executive branch, was responsible for forming the budget and tax policy. TS
Not all old people are wise and not all long posts are intelligent. Your post is case in point. Eloquence does not always go together with intelligence.