[FoRK] "The United States is Insolvent"

Dave Long < dave.long at bluewin.ch > on > Wed Dec 20 16:52:52 PST 2006

> 	http://financialsense.com/fsu/editorials/martenson/2006/1217.html

More directly:


which follows the fine tradition of annual reports in having the happy 
material in shiny pictures up front (p.5 says that under current 
management, government is going great!) and the true numbers in grey 
tables buried in the back (including about 20 pages (p.149+) explaining 
why, unlike in an annual report, the accountants can't actually vouch 
for the numbers* -- among other things, there were about 11 billion USD 
worth of transactions this year that failed to match up on the books 
and 40 billion worth of "improper payments").

Now, on p.152, we find:
> Despite improvement in both the fiscal year 2006 reported net 
> operating cost and the cash-based budget deficit, the U.S. 
> government’s total reported liabilities, net social insurance 
> commitments, and other fiscal exposures continue to grow and now total 
> approximately $50 trillion, representing approximately four times the 
> Nation’s total output (GDP) in fiscal year 2006, up from about $20 
> trillion, or two times GDP in fiscal year 2000.

That 50T is an interesting figure, because I've been working on the 
basis of there being only around 30-40T of total US private net worth.  
Anyone have a good explanation for this discrepancy?


:: :: ::

* p. 150
> The federal government did not maintain effective internal control 
> over financial reporting (including safeguarding assets) and 
> compliance with significant laws and regulations as of September 30, 
> 2006.

In other words, management's not only liars and cheats, but also 
thieves.  Trifecta!

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