Over the last 20 years there have been very defined economic trends that point to an eventual day of reckoning for the U.S. economy. A good example would be over the past decade the United States has outsourced the majority of its domestic manufacturing to foreign nations. Many can be found on the coast of communist China, others have fled to Mexico, South America, the Philippines, and Vietnam. The U.S. as a nation has opted out to become a massive consumer nation. This specialization in consumerism means for the first time in our history the personal savings rate of Americans has dipped below 0 percent!
The Credit Industry
The credit industry of today now trumps the manufacturing industry in total revenues. Our consumer crazed nation now purchases everything in sight using high interest credit cards in an effort to feed the hungry credit beast that has become a instant gratification devise. No longer do people save up to buy an item when they can have it up close and personal in a matter of hours. This buy now pay later mantra is even found in the largess of government where 40 cents out of every dollar is now borrowed to satisfy vast entitlement programs, spurious federal government bureaucracies, and new programs that have helped the government expand 28%.
The Entitlement Generation
America has created what is now being called the entitlement generation that has come to expect perpetually low tax rates to go along with low interest rates. It also expects unrealistically high government entitlement spending to go along with high investment returns. The new entitlement generation does not consider the concept of savings and sacrifice to be essential as it pursues any form of delight and fanciful delicacy on its radar screen. This type of mindset has setup in the American economy nothing less than a feeble house of cards that has become completely vulnerable to external forces that await our demise that it appears now will come sooner rather than later.
The Painful Truth
The sad painful truth is the great American experiment in free trade, capitalism, and democracy stands on the precipice of a self imposed economic calamity of its own making. After World War 2 American stood as the world's greatest creditor nation, while today, just over 60 years later, America now stands as the world's greatest debtor nation in world history. The United States now represents to the world a reluctant historical empire in total economic decline that has little chance of getting its financial house in order unless it goes cold turkey. This has little chance of happening because like all good credit addicts there is no pay off at the end of the road.
U.S. Military Over-extension
The Unites States, as of today, has more than 700 military bases located in 120 countries. That means our military is located in over half the world's nations. Acting as the ever vigilant global policemen requires an annual budget of over $600 billion U.S. dollars. That is almost ten times larger than China's $65 billion, 12 time larger than Russia's $50 billion, 120 times larger than North Korea's $5 billion, and 140 larger than Iran's $4.3 billion.
The American Military Machine
In fact, funding the American military machine costs more than all of the rest of the world's militaries' expenses combined. This will clearly be unsustainable in the near future and is typical of an empire that has become overextended. As our military forces start to withdraw from the 700 bases worldwide there will be no guards at the door of worldwide terror and wars of chaos will rear its ugly head. America will no longer be able to afford to be the world's policeman.
Foreign Creditors
The American Empire's economy has become so grossly indebted to foreign creditors that foreign countries own a very large amount of America's real estate wealth and hold vast amounts of our government bonds, China comes to mind. The repercussions of this large foreign ownership of American interests allows China and other nations seeking global resources to enter our hemisphere and nothing is said when they explore for oil, natural gas, etc. To allow this kind of leverage from foreign powers points right back at weak leadership at the top. So our indebtedness to foreign powers that have regimes that are not friendly to the U.S. leaves us in a highly vulnerable position at home and abroad.
Answers
Answers to this mismanagement of financial stewardship will not come easy to a nation that is used to being satisfied with easy acquisitions of its desires through easy credit card use. First and foremost Americans should be taught the austere management of their own financial resources through a savings account that can be grown through a payroll savings plan that goes directly into a no go account that cannot be touched until retirement. This would allow savings to grow from their job with a large nest egg at the end of their work years.
Credit Card Junkies
Allow only a few credit cards per household eventually paying off and eliminating your debt starting with the smallest credit card balance first. Economic classes in financial stewardship should be mandatory in every high school nationwide. Passing this class should be mandatory in getting your high school degree.
Raising New Revenue for the Government
The tax codes should be changed to reflect an across the board flat tax for every working individual in America and every business corporation with no tax loopholes allowed. A national sales tax of 1% should be instituted to raise funds for government employment projects to get the country working again and paying taxes. Lobbyist should not be allowed to pursue Congress with deals for special interest groups that want special treatment with tax loopholes. This should be disallowed and made criminal with hefty fines along the way. This would be a good start along the way to getting America's financial house in order getting back to the good old days of living within your means.
The Credit Industry
The credit industry of today now trumps the manufacturing industry in total revenues. Our consumer crazed nation now purchases everything in sight using high interest credit cards in an effort to feed the hungry credit beast that has become a instant gratification devise. No longer do people save up to buy an item when they can have it up close and personal in a matter of hours. This buy now pay later mantra is even found in the largess of government where 40 cents out of every dollar is now borrowed to satisfy vast entitlement programs, spurious federal government bureaucracies, and new programs that have helped the government expand 28%.
The Entitlement Generation
America has created what is now being called the entitlement generation that has come to expect perpetually low tax rates to go along with low interest rates. It also expects unrealistically high government entitlement spending to go along with high investment returns. The new entitlement generation does not consider the concept of savings and sacrifice to be essential as it pursues any form of delight and fanciful delicacy on its radar screen. This type of mindset has setup in the American economy nothing less than a feeble house of cards that has become completely vulnerable to external forces that await our demise that it appears now will come sooner rather than later.
The Painful Truth
The sad painful truth is the great American experiment in free trade, capitalism, and democracy stands on the precipice of a self imposed economic calamity of its own making. After World War 2 American stood as the world's greatest creditor nation, while today, just over 60 years later, America now stands as the world's greatest debtor nation in world history. The United States now represents to the world a reluctant historical empire in total economic decline that has little chance of getting its financial house in order unless it goes cold turkey. This has little chance of happening because like all good credit addicts there is no pay off at the end of the road.
U.S. Military Over-extension
The Unites States, as of today, has more than 700 military bases located in 120 countries. That means our military is located in over half the world's nations. Acting as the ever vigilant global policemen requires an annual budget of over $600 billion U.S. dollars. That is almost ten times larger than China's $65 billion, 12 time larger than Russia's $50 billion, 120 times larger than North Korea's $5 billion, and 140 larger than Iran's $4.3 billion.
The American Military Machine
In fact, funding the American military machine costs more than all of the rest of the world's militaries' expenses combined. This will clearly be unsustainable in the near future and is typical of an empire that has become overextended. As our military forces start to withdraw from the 700 bases worldwide there will be no guards at the door of worldwide terror and wars of chaos will rear its ugly head. America will no longer be able to afford to be the world's policeman.
Foreign Creditors
The American Empire's economy has become so grossly indebted to foreign creditors that foreign countries own a very large amount of America's real estate wealth and hold vast amounts of our government bonds, China comes to mind. The repercussions of this large foreign ownership of American interests allows China and other nations seeking global resources to enter our hemisphere and nothing is said when they explore for oil, natural gas, etc. To allow this kind of leverage from foreign powers points right back at weak leadership at the top. So our indebtedness to foreign powers that have regimes that are not friendly to the U.S. leaves us in a highly vulnerable position at home and abroad.
Answers
Answers to this mismanagement of financial stewardship will not come easy to a nation that is used to being satisfied with easy acquisitions of its desires through easy credit card use. First and foremost Americans should be taught the austere management of their own financial resources through a savings account that can be grown through a payroll savings plan that goes directly into a no go account that cannot be touched until retirement. This would allow savings to grow from their job with a large nest egg at the end of their work years.
Credit Card Junkies
Allow only a few credit cards per household eventually paying off and eliminating your debt starting with the smallest credit card balance first. Economic classes in financial stewardship should be mandatory in every high school nationwide. Passing this class should be mandatory in getting your high school degree.
Raising New Revenue for the Government
The tax codes should be changed to reflect an across the board flat tax for every working individual in America and every business corporation with no tax loopholes allowed. A national sales tax of 1% should be instituted to raise funds for government employment projects to get the country working again and paying taxes. Lobbyist should not be allowed to pursue Congress with deals for special interest groups that want special treatment with tax loopholes. This should be disallowed and made criminal with hefty fines along the way. This would be a good start along the way to getting America's financial house in order getting back to the good old days of living within your means.
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