50 Things Every American Should Know About The Collapse Of The Economy
Economic Collapse Blog
Saturday, May 14, 2011
Right now, we are witnessing a truly historic collapse of the economy, and yet most Americans do not understand what is going on. One of the biggest reasons why the American people do not understand what is happening to the economy is because our politicians and the mainstream media are not telling the truth. Barack Obama and Federal Reserve Chairman Ben Bernanke keep repeating the phrase “economic recovery” over and over, and this is really confusing for most Americans because things sure don’t seem to be getting much better where they live. There are millions upon millions of Americans that are sitting at home on their couches right now wondering why they lost their jobs and why nobody will hire them. Millions of others are wondering why the only jobs they can get are jobs that a high school student could do. Families all across America are wondering why it seems like their wages never go up but the price of food and the price of gas continue to skyrocket. We are facing some very serious long-term economic problems in this country, and we need to educate the American people about why the collapse of the economy is happening. If the American people don’t understand why they are losing their jobs, why they are losing their homes and why they are drowning in debt then they are going to keep on doing all of the same things that they have been doing. They will also keep sending the same idiot politicians back to Washington to represent us. There are some fundamental things about the economy that every American should know. The American people need to be shocked out of their entertainment-induced stupor long enough to understand what is really going on and what needs to be done to solve our nightmarish economic problems. If we do not wake up enough Americans in time, the economic collapse that is coming could tear this nation to shreds.
The U.S. economy was once the greatest economic machine in modern world history. It was truly a wonder to behold. It worked so well that entire generations of Americans came to believe that America would enjoy boundless prosperity indefinitely.
But sadly, prosperity is not guaranteed for any nation. Over the past several decades, some very alarming long-term economic trends have developed that are absolutely destroying the economy. If dramatic changes are not made soon, a complete and total economic collapse will be unavoidable.
Unfortunately, the American people will never agree to fundamental changes to our economic and financial systems unless they are fully educated about what is causing our problems. We have turned our backs on the principles of our forefathers and the principles of those that founded this nation. We have rejected the ancient wisdom that was handed down to us.
It has been said that those that sow the wind, shall reap the whirlwind.
We are about to experience the consequences of decades of really bad decisions.
Hopefully we can get the American people to wake up.
The following are 50 things that every American should know about the collapse of the economy….
#1 Do you remember how much was made of the “Misery Index” during the presidency of Jimmy Carter? At that time, the “Misery Index” was constantly making headlines in newspapers all across the country. Well, according to John Williams of Shadow Government Statistics, if we calculated unemployment and inflation the same way that we did back during the Carter administration, then the Misery Index today would actually be higher than at any point during the presidency of Jimmy Carter.
#2 According to the U.S. Bureau of Labor Statistics, an average of about 5 million Americans were being hired every single month during 2006. Today, an average of about 3.5 million Americans are being hired every single month.
#3 According to the Wall Street Journal, there are 5.5 million Americans that are currently unemployed and yet are not receiving unemployment benefits.
#4 All over America, state and local governments are selling off buildings just to pay the bills. Investors can now buy up government-owned power plants, prisons and municipal buildings from coast to coast. For example, the mayor of Newark, New Jersey recently sold off 16 government buildings (including the police and fire headquarters) just to pay some bills.
#5 When Americans think of “government debt”, most of them only think of the federal government, but it is not just the federal government that has a massive debt problem. State and local government debt has reached an all-time high of 22 percent of U.S. GDP.
#6 If you can believe it, one out of every seven Americans has at least 10 credit cards.
#7 Credit card usage in the United States is on the increase once again. During the month of March, revolving consumer credit jumped 2.9%. Sadly, it looks like Americans have not learned their lessons about the dangers of credit card debt.
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#8 Last year, Social Security ran a deficit for the first time since 1983, and the “Social Security deficits” in future years are projected to be absolutely horrific.
#9 The U.S. government now says that the Medicare trust fund will run out five years faster than they were projecting just last year.
#10 Right now we are watching what could potentially be the worst Mississippi River flood ever recorded play out right in front of our eyes. One agricultural economist at Mississippi State University believes that this disaster could do 2 billion dollars of damage just to farms alone.
#11 The “tornadoes of 2011” that we just saw in the southeast United States are being called the worst natural disaster that the U.S. has seen since Hurricane Katrina. It has been estimated that up to 25 percent of all of the poultry houses in Alabama were either significantly damaged or destroyed. It is also believed that millions of birds were killed.
#12 The economic effects of the BP oil spill just seem to go on and on and on. The number of very sick fish in the Gulf of Mexico is really starting to alarm scientists. The following is how one local newspaper recently described the situation….
Scientists are alarmed by the discovery of unusual numbers of fish in the Gulf of Mexico and inland waterways with skin lesions, fin rot, spots, liver blood clots and other health problems.
#13 The number of “low income jobs” in the U.S. has risen steadily over the past 30 years and they now account for 41 percent of all jobs in the United States.
#14 All over America, hospitals that care for the poor and needy are so overwhelmed and are so broke that they are being forced to shut down. Recently, a local newspaper in Florida ran an article about two prominent charity hospitals in Illinois that have served the poor for more than 100 years but are now asking for permission to shut down….
Two charity hospitals in Illinois are facing a life-or-death decision. There’s not much left of either of them – one in Chicago’s south suburbs, the other in impoverished East St. Louis – aside from emergency rooms crowded with patients seeking free care. Now they would like the state’s permission to shut down.
#15 The U.S. dollar is in such bad shape that now even Steve Forbes is predicting that the U.S. is “likely” to go back to a gold standard within the next five years.
#16 Most Americans don’t realize how much the U.S. dollar has been devalued over the years. An item that cost $20.00 in 1970 would cost you $115.93 today. An item that cost $20.00 in 1913 would cost you $454.36 today.
#17 Over the past 12 months the average price of gasoline in the United States has gone up by about 30%.
#18 U.S. oil companies will bring in about $200 billion in pre-tax profits this year. They will also receive about $4.4 billion in specialized tax breaks from the U.S. government.
#19 It is being projected that for the first time ever, the OPEC nations are going to bring in over a trillion dollars from exporting oil this year. Their biggest customer is the United States.
#20 According to the Pentagon, there are minerals worth over a trillion dollars under the ground in Afghanistan. Now, J.P. Morgan is starting to tap those riches with the help of the U.S. military.
#21 Speaking of J.P. Morgan, most Americans don’t realize that they are actually the largest processor of food stamp benefits in the United States. In fact, the more Americans that go on food stamps the more money that J.P. Morgan makes.
#22 When 2007 began, there were about 26 million Americans on food stamps. Today, there are over 44 million on food stamps, and one out of every four American children is on food stamps.
#23 Back in 1965, only one out of every 50 Americans was on Medicaid. Today, one out of every 6 Americans is on Medicaid.
#24 Only 66.8% of American men had a job last year. That was the lowest level that has ever been recorded in all of U.S. history.
#25 The financial system is more vulnerable today than it was back in 2008 before the financial panic. Today, the world financial system has been turned into a giant financial casino where bets are made on just about anything you can possibly imagine, and the major Wall Street banks make a ton of money from this betting system. The system is largely unregulated (the new “Wall Street reform” law has only changed this slightly) and it is totally dominated by the big international banks. The danger from derivatives is so great that Warren Buffet once called them “financial weapons of mass destruction”. It is estimated that the “derivatives bubble” is somewhere in the neighborhood of a quadrillion dollars, and once it pops there isn’t going to be enough money in the entire world to bail everyone out.
#26 Between December 2000 and December 2010, the United States ran a total trade deficit of 6.1 trillion dollars with the rest of the world, and the U.S. has had a negative trade balance every single year since 1976.
#27 The United States has lost an average of 50,000 manufacturing jobs per month since China joined the World Trade Organization in 2001, and the U.S. trade deficit with China is now 27 times larger than it was back in 1990.
#28 In 2010, the number one U.S. export to China was “scrap and trash”.
#29 All over the United States, many of our once great manufacturing cities are being transformed into hellholes. In the city of Detroit today, there are over 33,000 abandoned houses, 70 schools are being permanently closed down, the mayor wants to bulldoze one-fourth of the city and you can literally buy a house for one dollar in the worst areas.
#30 During the first three months of this year, less new homes were sold in the U.S. than in any three month period ever recorded.
#31 New home sales in the United States are now down 80% from the peak in July 2005.
#32 America’s real estate crisis just seems to get worse and worse. U.S. home prices have now fallen a whopping 33% from where they were at during the peak of the housing bubble.
#33 According to a new report from the AFL-CIO, the average CEO made 343 times more money than the average American did last year.
#34 The European debt crisis could cause a global financial collapse like the one that we saw in 2008 at any time. The world economy is incredibly interconnected today, and the United States would not be immune. A recent IMF report stated the following about the growing sovereign debt crisis in Europe….
Strong policy responses have successfully contained the sovereign debt and financial-sector troubles in the euro area periphery so far. But contagion to the core euro area and then onward to emerging Europe remains a tangible risk.
#35 According to one study, the 50 U.S. state governments are collectively 3.2 trillion dollars short of what they need to meet their pension obligations.
#36 A different study has shown that individual Americans are $6.6 trillion short of what they need to retire comfortably.
#37 The cost of college tuition in the United States has gone up by over 900 percent since 1978.
#38 According to the Bureau of Economic Analysis, health care costs accounted for just 9.5% of all personal consumption back in 1980. Today they account for approximately 16.3%.
#39 One study found that approximately 41 percent of working age Americans either have medical bill problems or are currently paying off medical debt.
#40 The combined debt of the major GSEs (Fannie Mae, Freddie Mac and Sallie Mae) has increased from 3.2 trillion in 2008 to 6.4 trillion in 2011. Thanks to our politicians, U.S. taxpayers are standing behind that debt.
#41 The U.S. government is over 14 trillion dollars in debt and the budget deficit for this year is projected to be about 1.5 trillion dollars. However, if the U.S. government was forced to use GAAP accounting principles (like all publicly-traded corporations must), the U.S. government budget deficit would be somewhere in the neighborhood of $4 trillion to $5 trillion each and every year.
#42 Most Americans don’t understand that the Federal Reserve and the debt-based monetary system that it runs are at the very heart of our economic problems. All of this debt is absolutely crushing us. The U.S. government spent over 413 billion dollars on interest on the national debt during fiscal 2010, and it is being projected that the U.S. government will be shelling out 900 billion dollars just in interest on the national debt by the year 2019.
#43 Standard & Poor’s has altered its outlook on U.S. government debt from “stable” to “negative” and is warning that the U.S. could soon lose its AAA rating.
#44 In 1980, government transfer payments accounted for just 11.7% of all income. Today, government transfer payments account for 18.4% of all income.
#45 U.S. households are now receiving more income from the U.S. government than they are paying to the government in taxes.
#46 59 percent of all Americans now receive money from the federal government in one form or another.
#47 According to Gallup, 41 percent of Americans believed that the economy was “getting better” at this time last year. Today, that number is at just 27 percent.
#48 The wealthiest 1% of all Americans now own more than a third of all the wealth in the United States.
#49 The poorest 50% of all Americans collectively own just 2.5% of all the wealth in the United States.
#50 The percentage of millionaires in Congress is more than 50 times higher than the percentage of millionaires in the general population.
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65 Ways That Everything That You Think That You Own Is Being Systematically Taken Away From You
There is a reason why the wealthiest one percent of all Americans control 40 percent of all the wealth in the United States. The system is designed to funnel all of the wealth to them and to the government. Average Americans are experiencing a declining standard of living and it is not by accident.
Just check out some of the ways that our wealth is being taken from us....
#1 Do you think that you own your house? You might want to think again. Most Americans that "own a home" are paying a mortgage. If you stop paying that mortgage you will lose that home. Over a million American families were kicked out of their homes last year. This year a million more American families will get the boot.
But when those families get booted out onto the street they don't get their down payments back. They don't get all the mortgage payments that they have made back. The banks get to keep all of the money and all of the houses.
Perhaps you don't have a mortgage. Does that mean that you "own your home"?
No, not really. Just refuse to pay your property taxes and watch what happens. At best you can say that you have the right to rent your home from the government.
In any event, the reality is that the banks now own more of "our homes" than we do. During the most recent recession, the total amount of U.S. home equity owned by the banks surpassed the total amount of U.S. home equity owned by the rest of us for the first time ever.
Things used to be far different in this country. Once upon a time American families owned most of the houses and most of the land in this nation.
But now the banks own most of it. Sadly, most American families that believe that they "own homes" are actually enslaved to 20 or 30 year debt contracts.
#2 Do you think that you own your car? You don't own it if you are still making payments on it. If you stop making payments you will rapidly lose that car.
But even if your car is paid off, you can only operate that car if you do the following....
*You must pay the license fee
*You must pay the car registration fee
*You must pay the emissions inspection fee
*You must pay the property taxes on that car (if that applies in your area)
*You must pay the tire taxes
*You must pay the gas taxes
If you have paid all of those taxes, then you are permitted to drive only where the government allows you to drive and only under the rules that the government sets for you.
But at least you "own" your car, right?
#3 What about your possessions? Do you own them?
Well, yes, you probably own some possessions.
But that doesn't mean that they are not enslaving you.
After all, did you use a credit card to pay for any of them?
If so, you could end up paying much more for your possessions than you originally thought that they cost.
For example, if you only make the minimum payment on your credit card each month, a $6,000 credit card bill could end up costing you over $30,000 (depending on the interest rate).
#4 Do you own your education? Well, it is undeniable that nobody can ever take it away from you. But if you took out student loans that debt may end up enslaving you for decades.
The borrower is the servant of the lender and student loan debt is more of a financial drain on Americans than ever before. Americans now owe more on student loans than they do on credit cards. As hard as that is to believe, that is actually true. Americans now owe more than $903 billion on student loans, which is a new all-time record.
#5 Will you protect your wealth if you put your money in the bank?
No, in fact your wealth will be systematically destroyed in the bank.
Inflation is a hidden tax on every single dollar that you own. It destroys the value of all dollars in existence. There are some Americans that have been saving money for decades, but those savings are being taxed into oblivion by inflation. Many experts are now projecting that the average price of a gallon of gasoline will hit $5 by the end of the year. So the next time you go to the gas pump just take a moment to think about how your wealth is being drained away by inflation.
#6 Insurance costs continue to soar. After insuring everything in our lives many of us barely have any money left over to actually live our lives with. In particular, health insurance premiums have become completely and totally ridiculous. According to the Los Angeles Times, Blue Shield of California plans to raise rates an average of 30% to 35%, and some individual policy holders could see their health insurance premiums rise by a whopping 59 percent this year alone. So how are American families supposed to survive if they keep on handing over bigger and bigger chunks of their income to the health care industry?
#7 State and local governments all over the nation have turned to ticket writing as a primary revenue source. In fact, in some areas of the country traffic citations are soaring at a crazy rate. For example, 110,000 more traffic citations were written in Los Angeles County last fiscal year than were written in the fiscal year immediately prior to the last recession.
The truth is that the police even realize what is going on. Just consider the following quote from from Police Chief Michael Reaves of Utica, Michigan....
#8 Some states have decided to simply confiscate wealth even if nothing has been done wrong. For example, the state of California is aggressively seizing "unclaimed" safe deposit boxes. If you have a safe deposit box that you have not checked on in a while you might want to make sure that it is still there.
#9 You might end up losing your valuables when you cross the border. It is being reported that U.S. border agents are now regularly seizing laptops and other electronic devices as people cross the border. In many cases those items are never returned.
#10 If you don't pay your property taxes, you will lose your house and it will likely be a big Wall Street bank that will be taking it from you. As I have written about previously, the big Wall Street banks are buying up thousands upon thousands of tax liens and are making a killing by socking distressed homeowners with predatory interest, outrageous penalties and almost unbelievable legal fees.
#11 Of course the biggest way that our wealth is being drained is through federal income taxes. The reason that the Federal Reserve and the IRS were established back in 1913 was to redistribute wealth. Wealth is transferred from the American people to the U.S. government and then ultimately to the elite and to the causes that the elite favor.
But federal taxes are only one of the taxes that we pay. The truth is that the average American pays dozens of different taxes each year. Just check out a few examples of the different taxes that drain our wealth....
#12 Accounts Receivable Taxes
#13 Building Permit Taxes
#14 Capital Gains Taxes
#15 CDL License Taxes
#16 Cigarette Taxes
#17 Corporate Income Taxes
#18 Court Fines (indirect taxes)
#19 Dog License Taxes
#20 Federal Unemployment Taxes (FUTA)
#21 Fishing License Taxes
#22 Food License Taxes
#23 Gasoline Taxes
#24 Gift Taxes
#25 Hunting License Taxes
#26 Inheritance Taxes
#27 Inventory Taxes
#28 IRS Interest Charges (tax on top of tax)
#29 IRS Penalties (tax on top of tax)
#30 Liquor Taxes
#31 Local Income Taxes
#32 Luxury Taxes
#33 Marriage License Taxes
#34 Medicare Taxes
#35 Payroll Taxes
#36 Property Taxes
#37 Real Estate Taxes
#38 Recreational Vehicle Taxes
#39 Road Toll Booth Taxes
#40 Road Usage Taxes (Truckers)
#41 Sales Taxes
#42 Self-Employment Taxes
#43 School Taxes
#44 Septic Permit Taxes
#45 Service Charge Taxes
#46 Social Security Taxes
#47 State Income Taxes
#48 State Unemployment Taxes (SUTA)
#49 Telephone federal excise taxes
#50 Telephone federal universal service fee taxes
#51 Telephone federal, state and local surcharge taxes
#52 Telephone minimum usage surcharge taxes
#53 Telephone recurring and non-recurring taxes
#54 Telephone state and local taxes
#55 Telephone usage charge taxes
#56 Toll Bridge Taxes
#57 Toll Tunnel Taxes
#58 Traffic Fines (indirect taxation)
#59 Trailer Registration Taxes
#60 Utility Taxes
#61 Vehicle License Registration Taxes
#62 Vehicle Sales Taxes
#63 Watercraft Registration Taxes
#64 Well Permit Taxes
#65 Workers Compensation Taxes
Even the future is being taken away from us. The future is literally being stolen from our children and our grandchildren. They will be inheriting the 14 trillion dollar (and still rising) national debt that we have accumulated. What we have done to future generations is unthinkable, and yet we continue to endlessly borrow more money. The Congressional Research Service estimates that the U.S. government will need to borrow $738 billion between April 1st and September 30th. Faith in U.S. Treasuries is falling so rapidly that now the biggest bond fund in the world, PIMCO, is actually shorting U.S. Treasuries.
When you base an entire economy on debt, eventually you end up with money problems that never seem to end. As a nation we are now enslaved to a vicious spiral of debt that is going to destroy everything that our forefathers worked so hard to build.
As the debt loads of our federal, state and local governments become even more burdensome, they are going to want even more money from us. For decades we gave in to new tax after new tax thinking that it would finally satisfy them. But it never seems to be enough. They always want more.
It is the same thing with the banksters. They are never satisfied either. They always want more assets and they always want more Americans to be enslaved to debt.
Unfortunately, most Americans are so caught up in the "rat race" that they never take much time to think about who designed the race or why they are running it.
Hopefully more Americans will wake up and will realize that our entire economy and our entire financial system need to be reformed. Our current system is inherently flawed and it will eventually impoverish the vast majority of us if we allow it to.