What’s the difference between a Ponzi scheme and the federal government?
The main difference between a Ponzi scheme and the federal government is that the government can legally print and borrow money.
From Terence Jeffrey:
In fiscal 2010, according to numbers published by the Census Bureau and the Office of Management and Budget (OMB), net spending by all levels of government in the United States was $5,942,988,401,000. That equaled $50,074 for each one of the 118,682,000 households in the country.
In that same year, according to the Census Bureau, the median household income was $49,445.
That means total net government spending per household ($50,074) exceeded median household income (49,445) by $629.
But things that can’t continue forever, wont, right? Right.
Since the government can print and borrow money, its scheme’s collapse is delayed from the present into the future (also known as intergenerational theft). It would certainly seem more difficult to be a Ponzi schemer than a government type as 1) it’s illegal, and 2) there’s always the challenge of adding “customers” to the fraud in order to support the schemer’s lifestyle and to pay out those who may have figured things out. It’s quite a bit more difficult to opt out of the federal government.
…between 2000 and 2010, government in this country went from spending $12,049 less than the median household income to spending $629 more.
(Sadly, the above discussion is only in reference to the federal government and doesn’t even include state, county, and municipality deficits and debt.)
In fact, the government’s ability to print and borrow means no worries… until the music stops. And when the music stops, there are either “haircuts” for those the government owes money, damaging inflation, or default.
Or all three. The American circumstance, like the Cyprus banking situation, will not end well.