Fallacious Accounting by Our Government – 15 Nobel Prize Winners, 1,000 Top Economists come together. JOIN IN TODAY

America in Worse Fiscal Shape than Detroit-Professor Laurence Kotlikoff By Greg Hunter On December 4, 2013 In Market Analysis 109 Comments

KotlikoffBy Greg Hunter’s USAWatchdog.com

Boston University Economics Professor, Laurence Kotlikoff, says, “The country is in worse fiscal shape by many miles than Detroit. So, the country is essentially bankrupt.” Dr. Kotlikoff estimates the long term debt and liabilities of America are more than $200 trillion! He is spearheading a bill in Congress called The Inform Act. It is an attempt to wake up the nation to our dire financial situation so something can be done to fix this enormous problem. Dr. Kotlikoff explains, “The bill has been endorsed by over 1,000 economists, including 15 Nobel Prize winners in economics . . .Never in the history of this country have this many top economists from all political persuasions endorsed a piece of legislation like this.” Dr. Kotlikoff and his fellow economists all contend, “The country needs to do honest accounting.” The professor charges the government is “disguising the true problem.” Dr. Kotlikoff says, “The government is printing mountains of money to pay its bills. The Fed is printing 29 cents of every dollar that Uncle Sam is spending.” What happens if this continues? Dr. Kotlikoff says, “Eventually somebody recognizes this and starts dumping the bonds, and interest rates go up, and inflation takes off, and were off to the races.” In closing, Dr. Kotlikoff warns, “This is going to crash, but there are different ways for cancer to kill you. It can be very gradual . . . or it can attack some organ and you can die overnight. Either of those outcomes can happen.” Join Greg Hunter as he goes One-on-One with Professor Laurence Kotlikoff.

Professor Kotlikoff and, indeed, virtually the entire economics profession, are appealing for your help to get your members of Congress, starting with your Senators, to pass this vital law.

 

0:05
I and break out your welcome to USA watchdog dot com
0:08
when this an old friend of ours has been on a couple a time we don’t have on your
0:11
end up
0:12
doctor Lawrence Kotlikoff professor at economics at Ball State University
0:17
doctor colic of
0:18
thank you for joining us today on USA watchdog dot com
0:22
my pleasure grade everybody here well you have a deep resume
0:26
and out but i wanna talk about what you’re currently doing you are
0:30
of course sponsoring our basic come up with the idea in congress a bipartisan
0:35
bill called the
0:36
inform act and that basically you’re trying to get
0:40
the government and the people and everybody else to wake up
0:43
with this huge amount in debtors at get
0:46
yes and things that we are on the hook to pay for into the future a
0:50
a comprehensive measure up government indebtedness is what this bill is called
0:55
in
0:55
you know you’ve been on here talking about what we’re really on the hook for
0:58
as you don’t north at
1:00
to 100 trillion Dollaz
1:04
that’s not a mistake that’s not a crazy former accounting you explain to that
1:08
just before that any up any you know
1:11
the graduate student would figure out the what we’re on the hook for the same
1:16
way you did please tell us about the
1:18
inform okay well
1:21
or small your listeners can go to near your skin go to
1:25
WWW dot in for Mac died or and
1:29
will see there is the bill and I helped generate the language but it’s not
1:34
a bipartisan bill that was rejoin sponsored in the Senate by senators
1:38
k in senator Cain is a democrat from Virginia and senator
1:42
the user public and from South Dakota so these two senators who damage joined by
1:47
six other senators
1:49
she ran out three Democrats and five Republicans sponsoring the bill
1:53
and then there’s the correspondent bill in the House
1:56
they’re paying the store we need acting to get sixty senators because I think
2:00
the house for
2:01
will go for the bill %uh other
2:05
more easily and the senate so what I need a
2:09
ask for europe yours here is to go to the
2:13
inform act out or endorse a bill online if you like
2:17
but dunno main thing is to talk to your senators
2:20
and get them choose cosponsored the bill the other
2:24
the bill has been and/or says she’ll see at in for Mac downward by over 1000
2:28
economists
2:30
and %uh that missing crew includes 15 Nobel Prize winners in economics and
2:35
it’s very important to realize
2:36
a and people won’t know this by just looking at the names but I do for not
2:41
knowing the people
2:42
that we have a close there from the left and the right in the center
2:46
so they’re actually probably more democrats on this
2:49
%uh endorsement list and republicans in this is not some
2:52
right-wing efforts to cut
2:56
Social Security or Medicare or Medicaid
2:59
I it’s not and there’s no alternative
3:02
culture a motive but we have here is the entire profession
3:07
almost 2 up a person saying
3:11
that the government accounting is fallacious
3:14
and that we need to put everything on to the book stay things like
3:18
the obligation to the government to pay my mom sis treaty benefits every month
3:22
that’s a real dead
3:24
needs to be included we can just look at be
3:27
up the trees anywhere in the far sub indebtedness
3:32
and this fiscal gap accounting is but economic theory says to do so
3:36
overhauling my make sure that people understand this isn’t crazy time because
3:41
I thought well just your number here so aptly put it under no no it’s not my
3:44
numbers
3:45
its it was any graduate-level students
3:48
PhD with figure out hey here’s what our tax receipts are
3:52
and here’s how much you know we are on the hook for importing
3:56
year a minute just its to more than 200
4:00
trillion dollars and that’s what all these Nobel economist and including
4:03
yourself here
4:04
top-notch economies as well all your said hey this is the man were on da
4:10
look for a lot of money yeah this is really ten percent of GDP going forward
4:15
it’s about 57 percent are federal revenues every year
4:18
more it is what we need to get better that this gap if we want to
4:22
pay for what we intend to spend we need 57 percent more
4:26
revenue coming forth from the federal government
4:29
have been collected by the federal government or we have to you
4:33
if we don’t want to increase revenues we have to
4:36
are cut spending by 37 percent for the restive time starting this year
4:41
so what this is saying is that the country the calculations which are based
4:46
on this CB owes the Congressional Budget Office’s
4:50
most recent long-term alternative fiscal scenario projection which was released a
4:54
few weeks ago
4:56
shows that the country is in worse shape
4:59
by many miles then Detroit so
5:02
the country’s essentially bankrupt and
5:05
its the economics profession is sending the equivalent
5:09
up up letter that Einstein roaches roosevelt morning out the
5:14
nuclear threat from Germany that they might come up with a
5:17
a nuclear bomb sonic bomb
5:21
%uh this is the economics profession with the exception of some
5:25
a balmy extreme sides of the political aisle
5:28
saying lookup the country I need to do honest accounting
5:33
make national budget office Inc general general
5:37
Accountability Office the office of management and budget they are all
5:40
effectively I disguising the true problem
5:44
by bit through the basis so they’re counting so I waited
5:48
the break hope that you’ll get the director the CB 0
5:51
I’ll just on on a ride with you and ask him
5:55
why he’s not doing this analysis it takes about five minutes to get this
5:59
analysis together we should put it on the front of his website
6:03
but the fiscal gap is takes just their numbers in it what is it what is the
6:06
official what do you think
6:08
the by all the economists and people like yourself what’s the real
6:12
fiscal gap that were a this habitat house two hundred five trillion dollars
6:15
it’s ten point four percent of GDP on an ongoing basis
6:19
%uh thats up to staggering
6:22
yeah staggering a bit of money
6:25
you Italian fiscal gaps about five percent of GDP
6:29
on an ongoing basis Germany is actually also
6:32
got about 5 percent there’s a very big numbers 10 percent is just
6:36
I really really a awful rush it’s about eight percent
6:42
other countries like Canada and Australia and Chile is probably closer
6:46
to zero percent they’re in good physical shape
6:49
so this analysis we put everything on the books all the assets
6:53
which are all the future taxes but then you compare that with all the
6:57
liabilities
6:58
that are coming June which is all the spending commitments not just threw up
7:02
entitlement programs but also to defense spending
7:05
to infrastructure you know let’s see if we r
7:09
able to pay for this stuff for whether we’re leaving enormous bills short kids
7:14
and then let’s figure out what to do to address this is a dole’s
7:18
because we’ve been running by two you know what the definition of a Ponzi
7:22
scheme is
7:23
is when you engage in up fallacious accounting that’s really
7:27
fundamentally what a Ponzi scheme is all about and by hiding these debts
7:32
you and I accounting that ENRON will be embarrassed by
7:36
where that made up will be really embarrassed by
7:40
which is saying a lot by doing that for 60 years the federal government from
7:44
and both parties that participated have done
7:48
left us in this chart a whole lot our children and
7:51
and this is why you have people that are extreme liberals
7:56
on this was a thousand times as well as extreme
7:59
gonna pre Xtreme the Conservatives you got jeff sachs
8:02
from Columbia University is very liberal and you have
8:05
Glenn Hubbard it was the I’d headed the Council of Economic Advisers under
8:10
President
8:11
George W Bush also on that list seven dressers you got it
8:16
an amazing list if economists people from all the top schools MIT Stanford
8:21
Harvard
8:22
I you name it at princeton have in your sis bill
8:26
and fifty noble prize winners never in the history in this country
8:29
that’s only top economist for both well from all political persuasions
8:34
and 15 nobel prize winners ever endorse a piece of legislation
8:38
now we put an ad in the New York Times back in October a full-page ad
8:44
%uh and if you go back to %uh page 9
8:47
about 20 per 20 seconds New York Times addition
8:51
fiscal newspaper you’ll see the entire list is a thousand economist at
8:56
fifty Nobel Prize winners
8:58
were short Sanders endorse the bill michael boskin the former head of this
9:02
council Economic Advisers under
9:05
the first president Bush where prominent people
9:08
former director Jim Miller ok director the R&B
9:12
ever and and how many people in the press read about it
9:16
today neither report is the new york times tonight about a full-page ad did
9:20
anybody from the Wall Street Journal
9:22
it anybody from any other major
9:25
media outlets no are you in NASH this yet just absolutely
9:30
listen it’s one thing to have some conspiracy theories on the Internet
9:34
it’s quite another thing to have all the people that you talked about Nobel Prize
9:38
winners a thousand top economist
9:40
right and left that is stuuning at to me that’s a story
9:45
headed to the mainstream you know that’s a story it’s a legitimate source
9:48
story which is why I want to have you watched and let’s get to the point
9:52
we know this and you’ve got you your you came loaded for bear
9:56
you you have a case you have sources you have
10:00
dozens up hundreds of sources that say this a problem
10:03
what happens if we don’t get this under control
10:06
well the government is already printing mountain of money
10:09
 to pay for its bills the Federal Reserve
10:14
is up bring 29 cents at every dollar that Uncle Sam spending
10:19
just bringing it out then air so this way
10:23
countries are paying so much money and they’re so broke
10:27
so that there’s no prospects overtime up
10:31
coming up with the taxes to cover the spending their political agreement
10:35
I a you start and a half with not somebody eventually recognize this
10:40
and starts I’d dumping the bonds and interest rates go up in inflation
10:44
takes off and then you’re off to the races we’re talking about
10:48
the kind of behavior you would expect from zimbabwe
10:51
& we”re seeing it right in front of your eyes %uh
10:54
Chairman Bernanke he had the Federal Reserve causes quantitative easing
10:58
but what he’s really doing is easing the burden on congress from
11:02
being fiscally responsible and he say he also the burden of the president
11:07
if he wasn’t but paper you know coming up with 29 cents on the dollar
11:11
the dead in the hands of the public will be that much higher
11:15
and I’m it would be our more parent
11:18
what’s going on so so somebody at some point a wall street’s no wake up to this
11:23
reality bit Bill Gross did for a while
11:26
and then he went off and tried to sell by insured
11:29
and that didn’t work out for him so I don’t think he’s talking about the
11:33
realities too much anymore
11:35
but but the realities are real just because the short term trading
11:39
straight up did work on a per yeah assurances math
11:44
Wall Street guys up a
11:47
are exactly a great prime you know break prognosticators
11:50
what’s coming because they’re worried about losing money on their own if they
11:53
lose my to gather
11:55
in up on scheck route in a herd
11:59
then they still retain their jobs that they go up Andrew
12:02
lose money on their own %uh that’s a problem for them they lose their jobs so
12:07
I recently spoke to a group of about 50 bond traders
12:13
shoreen very major mutual fund company and
12:17
they were interested in two things what were the fundamentals
12:20
and what that other bond traders say that was what they were concerned about
12:24
crime early
12:26
one with the other bond traders gonna flip to
12:29
a dumping US Treasuries and a
12:33
closing the next the eventually recession we can have a recession and
12:37
inflation at the same time we saw that in the seventies be so that in Germany
12:41
in the twenties and hungry at forward to gonna hyperinflation and we’ve got
12:45
enough money out there
12:47
potentially to produce a perforation I wanna talk about Obamacare
12:51
I’m everything in the newspapers AP story and talk about what are the
12:55
examples a good example %uh
12:56
Obamacare and the on medicaid and no kidding
13:00
the guy says well if I see a doc right and all our
13:03
ago the hospital I pay five dollars and I’m thinkin
13:07
who is picking up the tab and thats again
13:10
you know were exploding is it Obamacare going to explode
13:13
the federal deficit is in this taken at least on the spending side
13:17
the wrong way we can just text everybody’s income to zer0
13:22
well so arrived
13:25
I think everybody needs to have a health insurance policy
13:29
and I think the government has to be involved because the health insurance
13:32
industry has made a mess and things
13:34
that’s why we have 15 million people uninsured I do not believe that
13:37
Obamacare was the right way to go
13:40
I think from what we’ve now done in Santa walk nicely
13:43
health insurance sector we have Obamacare we have medicare we have
13:47
medicaid
13:48
we have employer-based health care the federal government is paying
13:52
 for 3 those programs pretty much directly and the
13:57
employer-based health care is also a huge
14:01
government expenditure because one week when my employer like was University
14:06
pays for my premiums health insurance premiums it’s not
14:10
parted my tax plan comes as a huge tax break and that’s an effective
14:14
an expansion so we got the government spending money on all these programs to
14:18
ensure the public
14:20
in the most efficient way and you’re right the way the Obama Care System
14:24
Setup
14:25
it could explode in Gloucester alive arguments for why that would happen
14:29
and what we really need is a very simple
14:33
rationalized system I’ve put it together enough proposal for the purple health plan
14:37
which is that the poor
14:38
full herbal health plan not ordered and that plan has been endorsed by lots of
14:43
economists including five Nobel Prize winners
14:45
so economist at me if you leave this joke honest if you can make that the
14:50
condoms to spend a couple days in washington
14:52
we could fix health care we can fix a security weak equity nearly as rich
14:56
though you will be getting free dental and paying a dollar for a doctor in
14:59
it would be nearly as after we have to put a limit
15:03
everybody will get a basic policy base and that
15:06
and that in the form a batter that they can take your insurance company to buy
15:10
the basic policy
15:12
insurance companies would have to offer exactly the same policy
15:15
and what would be covered would be session this possible all the doubters
15:19
will not exceed 10 percent of GDP ever
15:21
so we have a limit on the total spending we have to ration what the government
15:25
would actually provide people
15:27
and about after would be based on your existing condition
15:31
now so he had diabetes you get a much bigger about you that if you’re healthy
15:34
so that the insurance companies going to be charged picking
15:37
thats it in a nutshell that have cheaper honey what they have now is
15:41
crazy time at which a while probably
15:44
50 percent a purposeful gap right there and
15:48
and it would be a save our kids and everybody would have a basic policy if
15:52
you’re rich you would buy supplemental policy
15:55
and we would have return health insurance into it sepulcher mind
15:58
anywhere
15:59
it wasn’t a you know they’re gonna bar bronze
16:03
a gold or platinum whatever policies will be just the same
16:07
several policy for everybody and they gonna have to pay some copays and
16:10
deductibles and he said
16:12
okay said you got was there become it would basically paper about you but it
16:15
would use an efficient access them
16:17
so there are proposals that I Britain others for a very simple pie
16:21
ways to fix the No is simple ways to fix the tax system
16:26
that Dad is also crazy mess any women also wouldn’t  have to have the IRS
16:30
involved waiting and to everybody’s personal information which
16:33
what people don’t realize but it’s pretty much been ahead revealed that
16:37
dennis is not
16:38
that a big has been a big issue yet and that is it
16:41
basically destroyed hippa I mean there’s no privacy anymore I mean that
16:45
government was at the border to stop people knew their health care
16:48
and you there their health a statistics
16:51
a stop to give the border recently Aveo the IRS knows
16:55
are far too much and I think I people on both sides the I would
16:59
arkadelphia real couple with the IRS knowing all year medical information
17:04
yeah I think that what as snow and it is so many ways
17:08
very valuable showing that and SAS and other
17:11
agencies are are going seemingly overboard we don’t know the other side
17:16
the story how many terrorist attacks have been prevented
17:18
when this over and over according to the outgoing NSA director
17:22
one perhaps two is exact quote one for house to
17:26
if they’re really big you know it’s it’s a tough very tough loss for the
17:29
president
17:30
hazard sup decision about think balance in this is a civil rights
17:34
is a lawyer right and he’s concerned about civil rights and privacy
17:38
so I I hair II don’t know exactly
17:41
where i come down on this whole issue here private
17:44
OVA a that but I i’m concerned. the current owner
17:49
more we’ve seen that in the past we we solve
17:52
the mccarthy hearings in the fifties we’ve seen the government abuse
17:56
its up a information and its powers
18:00
and that will happen again unless we put into place laws that will
18:04
universal contact us it closing I just when I i
18:08
getting in closing that that do you see a
18:11
I mean there’s a lot of chatter on the internet that in one of the things that
18:13
I
18:14
it what you put me on the pre-interview was up the price is going on lows
18:17
as in and my friend the doctor you are in good
18:21
standing other very well known money managers and
18:25
economic professors and PHD’s a former assistant treasury secretary so all
18:30
uniformly said unsolicited
18:32
my surprise is gone as long as it has but do you see if this cannot go on the
18:37
way
18:37
is at now I’m not saying that you should call a crash is a minute
18:41
but is this gonna crash at some point
18:44
this will crash were you know it there’s different ways for cancer check your
18:48
your can be very gradual every year you get a lil bit
18:51
sicker and so you finally you know expire
18:55
were a gun attacks and Morgan and you can
18:58
diary I think you know you know those outcomes can happen but we’re certainly
19:04
experiencing a us up till now slowly growing cancer
19:08
we’re recognizing and it’s Eric
19:11
not only destroy ask for our children and exactly when
19:14
and how is not clear because those bond traders on Wall Street
19:19
are really think is words when it comes to saying realities ur
19:23
or the not so big but they they don’t really
19:26
focus on the fundamental to just focus on what other people are thinking
19:30
on the market they think they can run outta there %uh the building
19:34
the first to smell smoke and leave it but now that the smart beat the crowd
19:37
out the building at the door
19:39
and up they were make sure they don’t want to practice
19:43
her that’s a risky plan my friend it is
19:47
yeah it’s a risky let less what we can trust was free to give us guidance here
19:51
you have to trust their are you know if we had it
19:55
a viral out great swine flu you would be talking to you
19:59
the same to the doctors and CDC a
20:03
Center for Disease Control listen to what they say
20:06
what we have  here is entire economics profession with the exception of people like Paul
20:10
Krugman and some people on all
20:11
on the far right the same the cut the government’s been lying about it for
20:16
position
20:17
we have to have honest caring and then we have to figure out what to do
20:21
it doesn’t mean we need to tear away social insurance and social protection
20:25
you heard yet people are left to the right here
20:28
by what I’m gonna ask your viewers to do is sick call their Senators
20:32
are all get in touch with %uh headed the
20:35
wrestle by Jarvis demand the
20:39
that this missile gap accounting be done immediately getting in such that they
20:42
had only get in touch with a header the JAL
20:45
demand that this be done and the man the Senators
20:48
take action support this bill you might want to call this
20:51
and the fantasy accounting act really you know
20:55
alright a the in form act air you are professor Kotlikoff at Boston University
21:01
thank you so much for %uh shedding light on this big picture story
21:05
thank you very much for being on USA washed up my pleasure thank you
Share

January 19, 2015 · Jennifer · No Comments
Posted in: Uncategorized

Leave a Reply