US financial crisis more important that Ebola

While the news is blasting with reports of the first Ebola case in the United States; a much more important story got kicked to the side.  Don’t get me wrong, Ebola is a dangerous disease and if it gets out of hand here in the U.S. (which I kind of suspect it will) it would be a true national tragedy.

The real issue that faces America however;  is debt and the way that the U.S. Federal Reserve is managing it.  A report in David Stockman’s ‘Contra Corner’ goes into great detail of how the Fed roles over some 8 trillion dollars per year.  According to the story the U.S. is issuing short term treasuries to save on interest payments from long term debt to the tune of 8 trillion dollars per year and growing.

This insane pyramid scheme is the result of decades of financial mismanagement from Carter and Reagan to Bush and Obama and all points in between.  We can point out that for one brief moment, President Clinton with the help of House Republicans balanced the budget for a short period of time using money from the so called ‘Social Security Trust Fund.’  A fund that in reality, does not exist.

At some point it became apparent that the U.S. could not handle the interest payments on tens of trillions of dollars in debt and other countries simply did not have the money to lend to cover our trillion dollar deficits.  So against all advice and common sense the U.S. Federal Reserve started monetizing the debt.  That is to say, it would create money out of thin air and pretend it was real and use that to make up the shortfalls.

Now to do this legally, the Fed had to get treasury bonds issued to ‘pay’ for the created money.  Its too confusing for me to completely explain, but basically, fake money is made legitimate by the purchase of debt created by the creation of debt created by printing money that doesn’t exist.  Got it?  Me neither.

So to keep from having to pay interest on the debt for the money that doesn’t exist etc. etc. The U.S. keeps issuing new treasuries to cover the old treasuries and the interest created by that drunken song and money dance.  So it continues to rise each year and will rise another trillion dollars by next year.  That is to say the official debt of 17.5 trillion and the total debt of 59 trillion is nothing short of utter and complete bullshit.  The exact number is simply unknown and that is the way the government wants it to stay.

It will take only one major crisis to bring the house of cards down.  I have long suspected as have many other bloggers, that the U.S. government has been preparing for such a scenario.  I further suspect that they already have a timeline in mind, which would explain some of these ammo purchases by agencies that don’t usually buy ammo or you believe the main stream media attempt to cover it up.

The timeline however, could be upset or even set into motion by one major crisis that drains what little is left of the reality of American budget management.  Ebola, could be that crisis.  If expands beyond an isolated case and requires activation of nationwide emergency resources it will require special funding.  Depending on how big this crisis gets or the next one we will see an economic collapse in the U.S. of biblical proportions.  There is simply no way to understate the danger or the scope of the crisis.

Now back to Puerto Rico, already in bankruptcy already facing its own health crisis.  The leadership of the Commonwealth have led the island into the same form of economic calamity that the U.S. government has, this despite a staggering 20 billion dollars in annual aid sent to the island without federal taxes.  How does the inept leadership of the island respond in the case of a complete financial meltdown in the mainland?

There will be only one exit: independence and it will be sold as a crisis response and it will be implemented poorly and the people of the island will suffer in ways that today cannot be imagined.  Fear mongering?  No.  The only salvation for the island is to take the conscious step now to move out from under the flag and begin separating its economic security from its complete dependency on the U.S.   Time is running incredibly short.

Sign the petition for Puerto Rico independence in English or in Spanish.


About worleyf

Semi-retired Media Relations guy, former radio and TV reporter and legislative aide. Middle of the road Libertarian (as if that actually existed) who reviews current news items and stories, and offers an alternative point of view.
This entry was posted in Budget, Economy, Independence, Puerto Rico and tagged , , , , , . Bookmark the permalink.

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