" The Fiscal Cliff Fantasy"

All we hear about these days is the "fiscal cliff" - if something is not done before the end of the year $500 billion in tax increases and spending cuts effective January 2nd will send the economy into another recession. I think the average American has their head in the sand; we have already gone off the fiscal cliff and are now in a financial "abyss". If we are smart (not probable with our political leaders) we might be able to climb out of the abyss and possibly get back to the edge of the cliff before we go bankrupt. If that can be done we would at least have a chance to get the country moving in the right direction again.

Here are some simple statistics:

- Our annual spending deficit is over $1 trillion. If the country goes "over the cliff", then spending and new taxes will reduce the deficit by $500 billion annually, while still leaving a $500 billion deficit. So by the end of the Obama's four years the national debt will still INCREASE to $18 trillion.

- And that is just the tip of the iceberg. According to the experts the unfunded liabilities of Medicare, Social Security, and pension funds/health care premiums for federal employees total $87 trillion...I'll repeat that - $87 trillion. It makes our present $16 trillion debt seem like we are rolling in dough.

Sadly most Americans have no idea what an "unfunded liability" is, and most don't care. But the truth is that this country is hopelessly in debt as a result of decades of financial mismanagement by politicians from both sides, who are more interested in getting reelected that telling their constituents the truth.

The election of Obama was stunning in that the majority voted for "more of the same".  Obama can't take all the blame for this country's financial demise, but he certainly gets the lion's share since the national debt increase under him has totaled more than all the Presidents before him.

I believe that people voted for Obama for one of two reasons; they have no idea what financial trouble this country is in and voted the democratic party line, OR they know the country is in financial trouble and because they are getting "free stuff" (welfare, food stamps, extended unemployment, disability, subsidized housing, etc.), their self-interest trumps their sense of responsibility to the country,  i.e. they want to get their free stuff as long as it's available.

Whatever the solution of this financial "abyss" turns out to be, it will require pain,  affecting every American.  That is the only sure prediction for the future.

Someone recently said that the situation is so far gone that 'policy" cannot change things at this point, especially with a socialistic administration in power.  They contend that an "event" will be the only thing that will get the country back on track (if that is possible).  That event could be the devaluation and collapse of the dollar, hyper-inflation, or possibly the financial default of the US government. Sooner or later the money will just run out, the printing presses at the Fed will be worthless, and those people lending us 40 % of every dollar we spend will finally say "no mas".