.... Actually the Federal government is already bankrupt. They owe $16 trillion dollars and they have annual revenue of about $1.6 trillion. So they owe ten times what they earn annually. Any corporation or business would have declared bankruptcy a long time ago. Fourty percent (40%) of the Federal budget goes to paying the interest on the debt. Not paying on the principal mind you. Just to pay the interest. The debt keeps growing and the interest payments keep growing.
The truth is that we have to raise taxes on everyone and drastically lower expenditures so that we can start paying down the principal of the debt. If we don't do that then eventually the government will have to choose between paying interest and paying for essential programs. When they choose not to pay the interest then nobody will loan them any more money and they will be bankrupt.
I wonder about this. The Federal Reserve is already buying 70% of US Gov't bonds. What is to stop them from buying 100% of the Federal debt? They could keep this fiction going on for a long time.
