Guest Post: Is The Debt Problem As Bad As They Say

Submitted by Tyler Durden
06/09/2011 12:05 -0400
165 comments

From Simon Black of Sovereign Man

Is The Debt Problem As Bad As They Say

On the rare occasion that I’m bored, I like to watch 24-hour news television for entertainment. It’s hilarious watching the talking heads spin out of control in apoplectic fits when they’re essentially arguing the same point; they might be from different parties, but they’re merely battling over small details of the same government-sponsored solution.

Recently I caught one of these talking head financial experts on TV arguing about debt levels in the United States. He was saying that the US debt doesn’t matter all that much because the US government has so many assets to offset its debt.

For example, he suggested that things like the highway system, national parks, and strategic petroleum reserve would more than offset America’s liabilities, so the looming national debt isn’t such a big deal after all.

He couldn’t have been more wrong.

The Government Accounting Office (GAO) puts out an annual financial report that looks and feels like corporate financial statements… of course, the US government doesn’t have to abide by the same accounting principles as the private sector, so they get to cheat quite a bit in overstating their position.

The most recent report is signed off by Tim Geithner and includes oodles of newspeak from the Ministry of Plenty about how dazzling their economic recovery measures have been. Needless to say, the numbers paint a different picture. http://www.gao.gov/financial/fy2010financialreport.html

Even when you add up -all- of the assets, right down to every desk, chair, and lifeguard stand, and even if you throw in a healthy boost to the asset column to account for premiums in the market value for land and “goldâ€