4/21/16 Unfunded Liabilities

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The national debt is more than 19 trillion dollars.  It’s doubled in the past six years.  And grows larger each year.

The problem is much worse. The country is running in the red to the tune of about 50-trillion dollars.  That’s the total when you add unfunded liabilities to the tab.  Things like Medicare, Social Security and military retirement benefits.

Here’s what’s happening behind the headlines.

Moody’s Investors Service has examined unfunded liabilities.  It ain’t pretty.

Over the next 75 years, the US has 3.5 trillion dollars in government and military pension obligations it cannot pay.  State and local governments owe another three and a half trillion.

The federal government has promised other post-employment benefits it cannot meet.  These include military burial costs and health care benefits for federal retires.  This is 3.2 trillion dollars.

Medicare Part A, the Hospital Insurance fund, also has a 3.2 trillion dollar gap.

The Social Security shortfall is the largest at 13.4 trillion or about three-quarters the size of today’s GDP.

The total of these and other state and local debt is about 30 trillion dollars.  Add in the national public debt and we’re in the hole nearly 50 trillion dollars.

This doesn’t take into account that Medicaid spending, which is growing out-of-control daily, is moving our nation closer to a financial death spiral.

At some point our children and grandchildren will be stuck with a bill they cannot pay.  What then?


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