David Ross from Radiant Asset Management indicates in his research that the total obligations of the U.S. government exceed $90 trillion referring to the estimate of the Financial Management Services of the U.S. Treasury. They include hospital insurance, supplementary medical insurance, and social security. “[T]he collected money (which Treasury has borrowed and Congress spent) falls far short of what is required to fulfill the long-term obligations of those programs, even if it had not already been spent. Almost all of the $90 trillion are promised obligations with no established method of payment.”
I have never seen this $90 trillion number. I come up with $107 trillion.
Ross points out further: “Including unfunded obligations, the U.S. moves to 1st, well above Taiwan and Zimbabwe, for the highest debt to GDP ratio. . . U.S. total debt plus unfunded obligations total 625% of GDP.”
The Peterson-Pew Commission on Budget Reform stated that “the United States would almost certainly experience a debt driven crisis,” that “could unfold gradually or it could happen suddenly, but with great costs either way.” “The excessive debt would. . . affect citizens in their everyday lives by harming the American standard of living through slower economic growth and dampening wages, and shrinking the government’s ability to reduce taxes, invest, or provide a safety net.”
Many experts believe that at some point such system of borrowing is going to collapse. Peter Schiff, the President of Euro Pacific Capital, argues that the way the U.S. government functions is that “we borrow money and then when the interest payments are due we borrow money to pay the interest. . . It is one gigantic Ponzi scheme.”
Peter Schiff is brilliant, but his video blog is of silly quality.
By the way, the deficit for this year so far is $651,000,000,000.
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