Government Bonds

[Martin Hash]

As obvious as it may sound, no one can tell the future. Since we can’t tell the future, all we can do is predict from past experience as engineers do. Engineers are partial to finding an equation that fits past data, plug in an unknown, and see if the results meet their expectations. For example, if engineers used U.S. budgetary data since Reaganomics kicked in during the early 1980s, they would expect The Debt to continue to increase because it always has. Obviously, apologist economists, like Paul Krugman, aren’t engineers because they "tell the future" that tax receipts will dramatically increase and will take care of all our budget woes. Never mind that during the roaring 1990s when America was awash with big money there weren’t enough tax receipts. Never mind that no scenario in our past points to dramatic government revenue increases. No, Paul Krugman puts his fingers on his forehead, closes his eyes, grimaces, and tells us that everything is fine - we can depend on America “growing” out of its financial difficulties. Well, ya know what Paul Krugman, I don’t have a Nobel Prize in economics but I'm an engineer and I call BULLSHIT!

In fact, the whole government economic model is bullshit, and all I have to do as an engineer is examine it for a moment. First off, “saving" is inapplicable when it comes to governments because they have no place to put the saved money. I know that's counterintuitive to "Home Budget" economists, but all you people keep thinking there are assets somewhere that Government can withdraw – NOT! The ONLY money Government has is TAX RECEIPTS. In fact, the idea of a "government Trust-fund" is an oxymoron because governments can't borrow from themselves. (What's happening now here and in the Euro Union is the result.)

Government finances are pay-as-you-go, a Ponzi scheme, and that’s okay as long as everyone goes into the scheme knowing what’s happening and plans accordingly. The rules are: (1) there are no Government Bonds, (2) tax receipts MUST EQUAL spending, (3) production MUST be MORE than consumption, and (4) NO foreign "Free Trade" deficits.

This is NOT Conservative ideology – I advocate Spend & Tax economics. This is a wake-up call to America that inflation is coming. It HAS to come because America is bankrupt, and we need to start over. And when we do start over, we need a Constitutional “Balanced Budget Amendment” to force tax increases to cover legislative approved spending, STOP accruing debt in the form of pensions, and have dedicated income streams (increased taxes) for any borrowing America is forced to do due to wars, natural disasters, etc.

I don't know how much clearer I can make this?