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Wednesday, April 21, 2010

Forging Our Own Future

It really is difficult to wrap our brains around the depth and breadth of our government spending and debt.  We become desensitized to the numbers that get bandied around.  I remember as a kid someone explaining that a million was a thousand thousand.  "If you had a million dollars, you could give a thousand people a thousand dollars EACH!"

It was an incomprehensible number to me.

Now, a million dollars is chump change - at least to our various levels of government.  When the latest 2010 Pig Book was released by the Citizens Against Government Waste, it identified over 9,000 overt acts of waste totaling more than $16 billion.

The Government Scribes (the press) made note that, "Pig Book: Earmarks Are Down in 2010," - the amount of our money that was used to pay off loyal supporters, and grease the skids for future jobs after they've left the employ of the government, dropped by 15%. 

And that's supposed to make us feel good.  That's like saying we should be thankful because the serial bank robber stole 15% less this time around.
Our national debt is currently $12.5 trillion dollars.  A simply unfathomable number to me.  Backwoods Home Magazine (my absolute favorite) had an editorial in this issue that helped to put it into perspective -
There are several ways to try and get a mental grip on just how much money a trillion is.  Reader Harvey Smith of Visalia, California, suggest we think of it in seconds:  One million seconds would take you back 11.5 days, one billion seconds would take you back 31.7 years, and one trillion seconds would take you back 31,546 years.  So 12.5 trillion seconds would take you back just under 400,000 years,
What is scary is that these numbers don't include our unfunded liabilities  - promises to pay without the means to make payment - for Social Security and Medicare.  Somewhere between $40 trillion and $85 trillion, depending upon where you get your numbers.

We can never, EVER pay this amount of money.  It is simply not possible.  Even at the astronomical tax rates, fees, excise taxes and other money-grabs we've got right now, the federal government only brings in around $2 trillion a year.  But they're spending $3.5 trillion.

Somewhere along the line, we will default on our promises as a nation.  The government will either stop paying on the Treasuries bills/notes that make up our national debt, or they'll cut back on the Social Security/Medicare services (which you and I have already paid for).  Or, most likely, they'll do both.

When will this happen?  We'll, that's the proverbial $64,000 Question, isn't it?

Government has an incredibly strong Will To Live.  We've seen it by the incredible growth in the size and scope it now has.  And there is no indication it will slow this growth - quite the opposite, in fact.

It puts on a good face, but we've seen it frantically patching the leaks of our sinking ship - the bailouts, the extensions of tax credits and other payments, the nationalizations of more and more industries - but it can't sustain this forever.  The till WILL run dry.  Government produces nothing - it only consumes.

I figure I've got another 30 or so years left on this earth.  It worries me deeply how this all will affect me when/if I am no longer able to provide for myself.  Even though my retirement planning specifically assumes SSI will be gone by the time I am deemed worthy to get my money back, I worry that through taxation or outright nationalization of retirement accounts, I'll be left at the mercy of the government.

The thought of what the future holds for my offspring - who have another 60+ years to live - frightens the hell out of me.

What a pile of crap we've left them.

Accept The Challenge

I truly believe individuals still have time to prepare their lives to soften the blow of what is coming down the road.  If we look to what made life easier in the former Soviet Union - perhaps even bearable - it was entrepreneurship. 

It took the form of the Black Market being filled with goods and services that were not widely available in the government-owned establishments.  Fresh meat, vegetables, alcohol, butter, etc.

Even during the lowest points of their history, individuals living in a repressive society were able to find a niche, and fill it. 

While I think it makes tons of sense to store as much food, water, precious metals and equipment as possible, all of these supplies will eventually run out. Truly successful individuals will have the skills necessary to produce these things on their own.  They'll be able to turn seed into crops.  Milk into butter.  Sugar into alcohol.  Raw steel into knives.

Even in a communist society such as the Soviet Union, the capitalistic laws of Supply and Demand made these basic necessities sell for a pretty premium.

And because fewer durable goods are produced, and they're of lower quality, having the skills necessary to repair or enhance these durable goods will be a valuable skill indeed.

Look around your home, and see what you could not do without or would pay a premium to possess.  A stick of butter.  An electric coffee pot.  A bottle of beer or a fifth of whiskey.  Eggs for your omelet.  A bar of soap.  A smooth running car.  Sweetener for your coffee.  Veggies for your table.  Protein for your stew.

Figure out how to do it "from scratch".  Hobbies aren't for idle time any more...

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