Trillion Dollar Deficits are here to Stay "I JUST CAN'T TELL YOU WHY!" by Braden Barty

Rand Paul was on the Late Show with David Letterman not too long ago as they discussed the economy, taxes, and debt.

Letterman, who, he himself is worth millions (erroneously calling himself middle class) was given government economical 101 basics by Paul but ended up unknowingly burying his head in the sand. He assumed the $14 trillion national debt was only something like $2 to $3 trillion (you can tell how worried he really is.)

I tell people this over and over again. Defense Spending for 2011 is $964.8 billion. The national deficit is $1.64 trillion. If you cut defense spending by as much as 50% you would still be stuck with $1.158 trillion deficit. If you taxed the top 1%, 100% of all their income, you still fall short of funding the government to last long enough before still needing to borrow more money. Besides that there is something called Hauser's Law that states that federal tax revenues since World War II have always been approximately equal to 19.5% of GDP, regardless of wide fluctuations in the marginal tax rate.

The majority of Tax revenue (96%) comes from the millions of earners who make up the top 50% of wage earners. It's not the quality of tax earner that makes up the income tax revenue but rather the quantity.

Filmmaker Michael Moore is someone who feels very strongly that the rich do not pay their fair share of taxes. I have already pointed out in the past that US Corporations pay the highest percentage compared to the rest of the world. This is the break down when it comes to personal income tax. Top 1% pay 37% of all the taxes. The top 10% pay 65%. The Top 50% pay 96% while the bottom 50% of tax payers pay less than 3% of the taxes collected through income tax. http://www.taxfoundation.org/news/show/250.html

So what does this all mean? It means trillion dollar deficits are here to stay. That's right. 2012, 2013, 2014, 2015 and so on and so on. Today as it stands 20% goes to pensions, 23% goes to health Care, 13 % goes to welfare and 25% to defense. Where did all this spending come from? Was it always here? Most of our Federal Tax dollars, 81%, goes to the big programs (including policing the world) that are not even specifically outlined in the United States Constitution. (The 10th Amendment says "The powers not delegated to the United States by the Constitution, nor prohibited by it to the States, are reserved to the States respectively, or to the people.")

It has taken decades of conditioning to get us to the point we are at right now. That is that "IF THE FEDERAL GOVERNMENT DOES NOT DO IT, WELL THEN, IT WONT GET DONE!"

And really all it is, plane and simple, is a Ponzie Scheme which is on the verge of collapse. The basic way a Ponzie scheme works is that those that come in early in the game benefit while those that come in late, when the money is so far spread out, end up losing.

So what is beginning to happen? We are buying time by borrowing and printing more money. We have, for decades, been living recklessly beyond our means. For every 1 dollar grandma and grandpa have put into the money pool they end up actually getting back about $1.50 to $2.00 for a few simple reasons. Our grandparents are now living longer! And to make sure they live as long as they can, we have more things such as greater medical advances to pay for. These advances help to make sure they live as long as they can even up until the last minute! Make sense? To make matters worse, as of about the mid 1970's, obesity among Americans has sky rocketed, which now makes us all the more unhealthy as a collective society, which in turn makes our medical bills even more expensive.

So just how long will it take before most of America is onto the fact that the system is unsustainable? It's now 2011 and I'm guessing we can do maybe one more trillion dollar deficit (2012) maybe two at most (2013) before the scheme really collapses, meaning we face up to the fact that something is terribly, terribly wrong. When that happens, people like David Letterman won't be scratching their head anymore on live TV and saying stupid things to their audience like he did on the night Rand Paul appeared on his show when he said, "You know, I think he’s wrong about some of these things. I just can’t tell you why.”

Watch the Full Interview on Youtube with Rand Paul and David Letterman