Boston University economist Laurence J. Kotlikoff argues that unless fiscal sanity prevails, and soon, the federal government's "bankruptcy will become a foregone conclusion."
The gap between expected tax receipts and expected future federal spending is $65.9 trillion over 75 years in current dollars, nearly twice the national wealth and five times the GDP. Medicare, foremost, and Social Security are the culprits.
Well, governments are not businesses and never will be; the worst businesses close up shop. Left to their devices, governments just go on and on and can do far more damage when they do not control spending.
They can float more bonds, raise taxes and discount the debt by promoting inflation. In the worst case, finally, there is hyperinflation, default and economic depression.
There is a way out, however, if Americans re-embrace self-reliance.
Social Security must be phased out in favor of privately owned accounts; Medicare spending must be reined in with the use of privately owned, tax-advantaged medical spending accounts.
Yet in the current climate, calling upon adult citizens to provide for their own retirements is ridiculed. The Founders and Framers, who embraced limited government, would be mortified.
The principles of freedom and individual initiative to which they dedicated their lives, fortunes and sacred honor are in danger of becoming historical curiosities.
