Backstabber Report

The U.S. As A Debtor Nation Is A Repeat Of Rome

When it comes to debt, I learned years ago to change my ways after a bankruptcy in the late 1980′s. I had an expensive home and more credit cards than I care to remember. I also had a good job that paid for it all. One day the job came to an end without warning and I had no real savings because of that debt. Cracking a nut of $1800/mo for the mortgage, plus the credit card payments, plus providing for 3 children was an effort in futility. Unable to find a similar paying job, I lost the home and my life went into the sewer for a few years, after a divorce that followed. My own micro-Rome had fallen.

I pulled myself up by my bootstraps, struggled financially for a few years, and got back on my feet – vowing to never be in debt again. One of the few promises I kept to myself. I now make money, not with just a “regular” job, but by making more money than my regular job by supplementing my income as an Internet Affiliate. A surprising feat, considering I knew little about computers when I started.

Why have I told you all that? Because like my previous micro-Rome, my own little world of financial instability – we live in a larger Rome that is heading for a fall because of debt.

I always had some basic knowledge about national debt. Much of it wrong and taught to me at a time when the U.S. wasn’t in the crisis it is in today. I remember a 9th grade high school teacher telling me that when the nation prints money without anything to back up the worth of it, we are simply borrowing money from ourselves. I remember asking him how we could borrow from something we don’t have. If our piggy bank is empty how could we be borrowing from something that doesn’t exist? He responded that we are just creating a big I.O.U. in the form of paper currency and eventually, when that new paper money is invested and makes money we will take the earned money, put it back in the piggy bank, thus giving the new paper money, we had previously printed, real value.

I never bothered to ask why we would need to print the money in the first place if we were saving. The fact was, we were already in debt, though not as severely then, when a chance of paying ourselves back may have been seen as a possibility. Now, we have reached a point when doing so may not be possible and it isn’t ourselves we owe – it is other nations who could cripple us economically, if they wanted.

For years I heard about the troubles with Social Security going broke, over-extended entitlement programs like Medicare, costs of military expansion for wars, and other problems with the economy. Since I am doing well personally at the moment and am not in debt I haven’t felt it to be much of a concern for me. What we aren’t given information about from the mainstream media is why these problems exist today – how our government placed our economy on the precipice of complete failure.

That was until I saw a not so mainstream documentary movie I purchased under the advice of my older brother. I’m not much into documentaries unless it is on a subject I especially enjoy and economics is at the bottom of my list. It took me 6 months to finally spend a few bucks, but I decided to purchase it. I felt I had better watch it to see what my brother was talking about.

The 85 minute documentary, I.O.U.S.A. was directed by Patrick Creadon and released on November 14, 2008. For those who do take an hour and a half out of their lives to watch it, it’s a true eye-opener about our nation on the brink of financial ruin on a grand scale and how we got there since the inception of our nation. The fact is, we don’t owe ourselves; we now owe China, the most powerful economic nation on the planet and we have nobody to blame, but ourselves.

The documentary gave a 2007 figure of $700 billion owed to China. Just the interest to be paid on that amount over the next 10 years will amount to $2 trillion. Let’s update it to our current predicament.

Mr. Johnson, a former chief economist for the International Monetary Fund, estimated that China now owns about $1 trillion in U.S. Treasury securities, or nearly half the $2.37 trillion stock of Treasury debt held by “foreign official” owners. In second place is Japan, to whom we owe $769 billion, so add a couple of trillion dollars more that will be paid in interest to Japan in the next 10 years.

Those are trillions of dollars that will not be used to improve our infrastructure, create jobs, upgrade our living conditions, or in any way provide for our citizens. It is money that will go into another nation’s economy for them to use as they see fit. They will improve while we degrade.

The documentary also delves into why Social Security is going broke.
Basically, Social Security should not be broke. It is one of the few programs that has consistently shown a surplus each year. The trouble is that each surplus has been taken away to pay off just some of our debt. If we had not siphoned off that surplus we’ve had for generations, S.S. would be around for the next couple of generations to come, even though more would be collecting than paying in. We have used that surplus for everything else except for maintaining it’s own viability. Not only will S.S. be unable to pay recipients within a few years, but the government will no longer have a source of income to pay down it’s debt to other nations.

Worthless money being printed is another problem.

Even I, with my very limited knowledge of economics, know that a country that simply prints worthless money to throw into the economy makes that money worth less. There is so much of it, it takes more of it to buy an item. That’s simple economics. Germany tried printing more money to avoid the depression that hit them after WWI. They printed so much of it, a suitcase full was required to purchase a loaf of bread.

The U.S. is following the same path with bailouts and an economic stimulus program that simply prints money and throws it at a problem. Billions for the auto industry in a bailout. Billions for the banks in a bailout. Billions for the stimulus packages. All amounting to trillions of dollars being put into the economy and circulated among the populace that makes all of it worth less, because there is more of it available.

This is only the tip of the iceberg and you can not get a grasp of the complete disaster facing us in one article, such as this one. This is just an introduction and a notice that real, easy to understand information about our economy is available.

If you want to get an in-depth look at what is coming and the REALITY of what we are facing in just a few short years you need to watch I.O.U.S.A.

It is far more entertaining than you might think and you might find yourself better prepared when the fall of Rome arrives.