Charles Hugh Smith had a thought provoking blog entitled “Can We Support 75 Million Retirees in 2020?”
His point is that The Federal Reserve cannot print its way out this entitlement disaster created by politicians.
As I have discussed before, the American economy is at a breaking point where almost 50% of Americans are receiving government benefits, 43% ar eprojected to be on Medicare and Medicaid (single payer) healthcare insurance and 43.3% are not paying any Federal taxes.
According to data released by the Census Bureau, 49.2 percent of Americans received benefits from one or more government programs in the fourth quarter of 2011.
And, of course, Americans earning up to 400 percent of the poverty level will qualify for a federal subsidy to buy health insurance. That will push the percentage over 50%.
And then came this story from the Washington Post, “In first month, the vast majority of Obamacare sign-ups are in Medicaid.” And a report from the Department of Health and Human Services declares that Medicare and Medicaid will provide 43% of all healthcare insurance in 2014.
Speaking of more and more people of the government dole, RealtyTrac estimates that 47% of the nation’s foreclosed homes are currently occupied by the borrowers who have defaulted on their mortgages. The percentage actually tops 60% in some hot housing markets, like Miami and Los Angeles. Those still living in repossessed homes include both former owners and renters. Either way, their time in the homes is mortgage and rent free.
Of course, nothing is “free.” Someone has to pay for it all. But with 43.3% of Americans paying no income taxes, someone has to pay a lot of taxes.
And The Fed simply can’t keep enabling the Ponzi Scheme of unsustainable entitlements. The CBO projects US debt to skyrocket.
I agree with Charles Hugh Martin. This is all unsustainable and we can’t print enough money to pay for it without tragic consequences.