Sunday, May 16, 2010
Bankruptcy for the U.S.
Pratt's posting of Jim Powell's Freedom Daily piece on Argentina points out the possibility of the United States going bankrupt. A firm that has large and valuable assets but has a serious negative cash flow situation should liquidate -- sell those assets. The United States has a $13 trillion debt with unfunded liabilities of $104 trillion. It has a serious cash flow situation; it cannot sustain such a situation. Its debt will be about 100% of GDP by 2020; interest payments alone will constitute the biggest share of federal government spending.
In the picture above you can see how much land the federal government owns -- approximately 64% of all land west of the Mississippi. If a limit on government spending could be implemented by amending the constitution; if term limits, limited pay, limited retirement benefits, could be implemented again probably as a constitutional amendment, and then the federal lands were sold, the huge debt could be paid for. I would expect bases such as those along California coasts, and national parks such as the Grand Canyon and Yosemite would raise a fair penny. Environmentalist groups could compete with developers to purchase the land. Resources would be allocated more efficiently, and the U.S. could return to what its founders intended it to be.