creative tusk

I’m sure you’ve heard the rhetoric by now how only the “rich” will be taxed and everyone else’s taxes will be reduced. It’s not going to happen. Everyone’s going to pay before this is over.

Trillions of dollars of bailouts must eventually be paid for on top of the over ten trillion dollar deficit. The Federal debt and deficit were at all time highs before the bailouts while many state, county, and local municipalities are out of money, in debt, and running deficits. Our ability to keep borrowing our way deeper and deeper into debt is finally reaching an end.

We are in a recession citizens. Yet the government must have enormous sums of money. They will both print more of it devaluing the dollar, adding to inflation, and erasing hard earned savings (sorry seniors) in the process and seek it from:

1. ____ Taxpayers

2. _____ Aliens

3. _____ Obama promised me only a few really rich people need to be taxed.

If you chose number 1, congratulations. The government will seek to get money from entities (individuals and organizations) that pay taxes.

And they are going to need a lot of money because the federal bailout money is far beyond the $700 billion package in the news.

As Don Rich points out at Contrarian Politics:

“Don Rich says the Congressional Budget Office (CBO)’s estimates of the taxpayer losses from the bailout of Fannie Mae (NYSE:FNM) and Freddie Mac (NYSE:FRE) are implausibly conservative. The real estate bubble of this decade was the biggest of any asset class in history. Rather than the CBO’s $25 billion figure, Dom says the real cost is at least $1.3 trillion, and could be as high as $2.5 trillion. And this doesn’t even account for the inflationary consequences of rescuing Wall Street. The Fed is on a money printing binge session, and anyone holding dollars will be picking up the tab.”

Even the Chinese are lining up for U.S. taxpayer bailout money:

“It may be hard to believe but the WSJ reports that Chinese sovereign wealth fund – China Investment Corp., “has applied to participate in the U.S. Treasury’s temporary guarantee program for money-market funds.” This at a time when Bloomberg reports that “China’s foreign-exchange reserves rose to a world record $1.906 trillion, helping to strengthen the [China's] nation’s finances as the credit crisis threatens…””

Some analysts point out it’s going to get worse.

Martin Hennecke says that the end result of the global economic slowdown may be the U.S. announcing national bankruptcy as the government cannot afford the bailouts that it promised and the market will not bail out the government, Martin Hennecke, senior manager of private clients at Tyche, told CNBC on Thursday stating:

“We expect a depression in the United States. We expect a depression, very possibly, also in Europe. We already have $3 trillion of debt, as far as the U.S. government is concerned. These debt figures across the U.S. economy are rising very sharply.

When the government can no longer pass the United States’ “immense debt” on to taxpayers, it will turn to the holders of U.S. dollars, leading to the eventual downfall of the currency, Hennecke said.

Definitely, it (the dollar) is not a safe place to be invested in, as real inflation is closer to 10 or 11 percent than the actual inflation numbers given by the U.S. government.”

Inflation is already here. But it’s going to get worse. Don’t let those falling gas prices fool you.

As Pat Buchanan points out in ‘Liquidating the Empire’:

“In the Crash of 2008, …stock value has vanished …real estate value has disappeared. A recession looms with sweeping layoffs, unemployment compensation surging, and social welfare benefits soaring. America’s first trillion-dollar deficit is at hand. In Fiscal Year 2008 the deficit was $438 billion.

With tax revenue sinking, we will add to this year’s deficit the $200 to $300 billion needed to wipe the rotten paper off the books of Fannie and Freddie, the $700 billion (plus the $100 billion in add-ons and pork) for the Wall Street bailout, the $85 billion to bail out AIG, and $37 billion more now needed, the $25 billion for GM, Chrysler and Ford, and the hundreds of billions Hank Paulson will need to buy corporate paper and bail out banks to stop the panic.

As Americans save nothing, where are the feds going to get the money? Is the Fed going to print it and destroy the dollar and credit rating of the United States? Because the nations whose vaults are full of dollars and U.S. debt — China, Japan, Saudi Arabia, the Gulf Arabs — are reluctant to lend us more. Sovereign wealth funds that plunged billions into U.S. banks have already been burned.

Uncle Sam’s VISA card is about to be stamped “Canceled.””

How right you are Pat. What we expect to see are taxes increase (in an environment where wages are flat and rising inflation is decreasing real income), unemployment rise, jail/prison overcrowding worsen as desperate poor people add to their population, America pull back liquidating the empire as they go, and the dollar devalue.

Tsk tsk… we sure have gotten far off track and right under the watch of both major political parties in this country… yet Americans still think either the Republicans or the Democrats will save them and they won’t have to foot the bill either. We find that simply amazing.

Repost from the Paleo Conservatist