NATIONAL DEBT OF THE UNITED STATES…..UGH!

NATIONAL DEBT OF THE UNITED STATES…..UGH!

(FRAZER CHRONICLE)

(All the News That Nobody Else Will Print)

 

The national debt of the United States is the amount owed by the federal government of the United States. The measure of the public debt is the value of the Treasury securities that have been issued by the Treasury and other federal government agencies.

Gross public debt consists of two components:

A. Debt held by the public, such as Treasury securities held by investors outside the federal government, including those held by individuals, corporations, the Federal Reserve System and foreign, state and local government.

B. Debt held by government accounts or intergovernmental debt, such as non-marketable Treasury securities held in accounts administered by the federal government that are owed to program beneficiaries, such as the Social Security Trust Fund. Debt held by government accounts represents the cumulative surpluses, including interest earnings, of these accounts that have been invested in Treasury securities.

Two plus paragraphs of mumbo-jumbo written by some Stanford graduate to explain what two words can explain our situation as a nation…..we’re broke. Yup the U.S. is broke, technically speaking, we…..ah, spend it before we’ve got it…..like an impulse sweet toothed buyer at the candy store.

We’re taking a spanking as a nation by our own people, Apple, Cisco Systems, Google, and Microsoft legally hold $124 billion in U.S. Treasury securities and $39 billion in U.S. government agency debt in accounts overseas, allowing them to avoid the 35% (maximum) corporate tax rate in the United States, according to Securities & Exchange Commission reports.

The four companies together would be the 14^th biggest overseas holder of Treasury securities, just ahead of Norway, Singapore, and India. Together the four corporations (Apple, Cisco Systems, Google, and Microsoft) have $255 billion in cash, cash equivalents, and marketable securities…..in their foreign subsidiaries, the Bureau of Investigative Journalism reported.

If the total amount was held offshore, making it subject to being taxed by the U.S. government, it would yield $89 billion, or 17% of America’s projected $514 billion dollar budget deficit this year. Overall the four companies hold $333 billion in domestic and foreign accounts, making them the most lucrative American firms outside the financial sector. The companies also hold $93.3 billion of corporate, municipal, and sovereign debt.

WE PAY ALL THE TAXES THAT WE’RE LEGALLY MANDATED TO PAY

“We pay every penny of tax that is due,” (we follow the tax laws that are established) that canned response to taxes that are paid by these corporations…..or at least what Cisco Systems said in response to the Bureau of Investigation question on tax payments.

Look…..there is a legal, and then there’s a moral question with regards to tax payments in this incident, and morality trumps legal every single time. Each corporation enjoys the fruits of their individual labor, and they deserve every single penny of profit that comes their way. However at the end of the day, when you are part of the problem…..and not the solution, and you take advantage of every single loophole that is available…..there is something really wrong with your thinking.

Twenty six of the most powerful American corporations, like Boeing, General Electric, and Verizon (my cell phone provider) actually paid no federal income tax from 2008 to 2012, according to a recent report that detailed how Fortune 500 companies exploit tax breaks and loopholes.

And more is never enough, as there seems to be a push to lower the tax rates that corporations fall under, even though the U.S. tax system towards business is…..well, dare I say it, “ lax.” There is an allegation going around Capitol Hill that the federal corporate income tax rate is uncompetitively high compared to other developed nations.

“Hold on there. Nellie,” while the U.S. corporate tax rate is technically the highest among Organization for Economic Cooperation and Development’s 34 member countries, the United States Congressional Budget Office found that the total corporate federal tax amount paid by American companies came to 12.1% of profits, the lowest total since 1972.

Besides offshore tax sheltering, companies are allowed to skirt tax rates based on factors that include accelerated asset depreciation based on continued investment, stock options, and industry-specific tax breaks. Bloomberg reported that the 317 largest U.S. based companies have $1.95 trillion held outside of the United States, an increase of 11.8% from 2012.

NATIONAL DEBT…..ABSOLUTELY NOTHING NEW

The United States has held a public debt since the original constitution went into effect March 4, 1789, except for 11 months between 1835-1836; America has had a national debt. Few understand exactly what a public debt is, and why or how we accumulated such an astronomical figure.

Like the man said, “its simple, stupid,” there really aren’t any secrets about America’s debt; it’s as simple as 2 + 2 = 4…..really. Government is just like operating a business; the government provides all sorts of services for us citizens, like a military, roads, education, and health programs. Here are the beginnings of problems…..politically with regards to what types of programs or benefits will be offered by the government.

The only source of income that a government, any government has is the taxes that it collects from its citizens…..the taxpayers. Here actually is the biggest divide between liberals and conservative thinking, the amount of taxes that are to be paid to the government…..for programs, benefits, and entitlements.

At the beginning of each fiscal year, government needs some cash on hand to procure all sorts of equipment, supplies, guns and bullets for those guns. If the country hasn’t been frugal…..like it never is, there is a debt…..it’s rolled over, and tacked on to the next budget.

This same activity without interruption has been going on for 178 straight years, since 1836, so you can understand how the country’s debt could be so…..ah, large. How large, try $17.226 TRILLION, and it just went higher…..I type slowly.

I could go on, with boring statistic after boring statistic, but I’m actually getting a headache from looking at all of these stats. This trend of deficit spending will (if left unchecked) be our undoing, our credit rating as a country was downgraded last year, and many experts said it was just a ho-hum thing. Well let me tell you, as a guy who has gone through some lean years, with the credit rating to prove it, a low credit rating is nothing to poo, poo, it’s not good, try to borrow money with a good rate attached to it…..you can’t, you’re a risk, and you’ll pay accordingly.

I’ve owed money to private individuals in my time, and let me tell you, it can strain friendships, and even family relationships. There’s an old saying, “never loan money to a friend,” and baby, truer words were never spoken. The United States however, has taken borrowing money to new extremes, owing the People’s Republic of China, and Japan excess of $1 trillion each…..come on, we’ve gotta be brighter than that.

WELL GUESS WHAT…..WE’RE NOT

What to get a real rush, I’ve got a list of the major foreign Treasury Securities holders, and the amounts that we owe them, better tighten up the old panty hose, it’ll be a rough ride;

China, $1268.9 billion; Japan, $1182.5 billion; Caribbean Banking, $290.9 billion; Belgium, $256.8 billion; Brazil, $245.4 billion; Oil Exporters, $238.3 billion; Taiwan, $182.2 billion; Switzerland, $175.1 billion; United Kingdom, $163.6 billion; Hong Kong, $158.8 billion; Russia, $138.6 billion; Luxembourg, $134.4 billion; Ireland, $125.1 billion; Norway, $97.2 billion; Singapore, $86.2 billion; India, $68.5 billion; Germany, $67.2 billion; Mexico, $65.1 billion; Canada, $55.7 billion; South Korea, $53.9 billion; France, $53.6 billion; Turkey, $52.2 billion; Thailand, $51.7 billion; Philippines, $40.2 billion; Netherlands, $36.9 billion; Sweden, $33.9 billion; Australia, $33.8 billion; Colombia, $33 billion; Poland, $30.9 billion; Italy, $30.3 billion; Chile, $26.1 billion; Israel, $23.7 billion; Spain, $23 billion; Peru, $14.8 billion; Denmark, $14.5 billion; Malaysia, $11.8 billion; South Africa, $11.3 billion; Uruguay, $10.7 billion; all others, $208 billion.

These figures were supplied on February 18, 2014 by the Department of the Treasury and the Federal Reserve Board. The total is Treasury bills, and T-bonds and notes for a total owed $5,794.9 billion dollars, a really, really staggering amount of money.

Some of the countries on the list I didn’t even know that they had that kind of money to throw around, like Uruguay, and Italy and their austerity programs that they’ve put into place. And Thailand, come on, what’d we do, give those people some water buffalo or something as collateral.

I absolutely stand corrected, we aren’t brighter then…..whatever, I’ve been in debt, actually still am, but geez, how in hell could the country even get some of those countries to come up with the cash. We are in really deep, the absolute worst sort of…..crap that a country could be in, and we run around the world proclaiming our spreading of our kind of democracy.

I WONDER IF THE UNITED STATES COULD GO TO A DEBT CONSOLIDATION COMPANY

The amount of interest that America must be paying is probably more than some smaller emerging country’s entire budget for their fiscal year. We need help, and I’m not talking about cutting governmental programs. Every time the fed cuts programs, it hurts those people who can ill afford another shot on the jaw.

Austerity needs to start at this time…..and trickle downwards, not the other way around like it seems to always happen. As a country, we’ve been at this deficit spending for decades, and it’s beginning to catch up with us. When lending institutions and money monitoring agencies start to worry about the perceived fat cat of the block, anyone with an ounce of gray matter knows that it’s time to reevaluate the operating procedures that have been in use…..for decades.

This blog has been, for me, an eye opener, it’s one of the reasons that I feel compelled, most times I learn as I blog…..and today I learned one hell-of-a lot….hope you did to.

 

HAVE A NICE DAY!