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No More Cooked Books, Treasury Secretary Threatens.

Written by Gary North on October 14, 2013

Treasury Secretary Jacob Lew has said repeatedly that on October 17, the U. S. Treasury will be down to its last $30 billion. This spare change will be used to pay interest on the government’s debt. What if it is not enough to get through the day?

If $30 billion in interest payments will not get the government through the day, there is way too much government debt.

The Treasury has been cooking the books ever since May 17, when the U. S. government’s debt ceiling mysteriously hit $16.7 trillion and stopped growing. The fact that the Treasury is playing fast and loose with various federal retirement programs in order to keep this illusion going has bothered no one in Washington. The leaders in the Republican Party have remained mute. They should have been screaming “Fraud!” every day since May 18. But Lew’s “extraordinary measures” are universally accepted by everyone: politicians, Wall Street, the Justice Department, and the voters.

The corruption in Washington is so great today that the most obvious case of fraudulent accounting is ignored. What would have landed a man in the private sector in jail for securities fraud has not gained even a whisper of criticism in Congress.

The voters do not know how this is being done. They do not care. It’s all mere numbers for them. They assume that the laws of accounting do not apply to the source of the funding that the politicians have promised: pensions, health care, and safety nets for all. These are all free goods, as far as they are concerned. Nobody has to pay. It’s Tinker Bell economics.

The voters are upset that the illusion of free money is at risk. They are angry that debt — which they think must never be paid off — does not rise automatically. They dismiss Congress as a bunch of children for not automatically raising the debt ceiling above $16.7 trillion — the on-budget debt. The voters have never heard of the federal government’s unfunded liabilities — the off budget debt — the present value of which is over $200 trillion.

Voters are the children. They believe in fantasies. They want fantasies to come true. They are upset that there is some minor and temporary resistance to some of the government’s smaller fantasies. But the cooked books are indicative of the underlying reality. The fantasy has gone on without criticism ever since May 17.

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6 thoughts on “No More Cooked Books, Treasury Secretary Threatens.

  1. The payment on the debt will be 28Billion so just pay the debt and the US will not default. That will still leave 2 Billion to buy Obama and ice cream cone with sprinkles on top. The US collects Billions of dollars EACH day in tax revenue. Time to downsize. Start with The Presidents salary.

  2. I think that Mr. North's assertion that the US voter doesn't know or care about the corruption in DC is an insult. I think he will find that We are NOT children who think everything is free. Romney said that about the 47% and was vilified. Mr. North. The Majority of the US voters are aware of what is going on as evidenced by the uprising currently sweeping thru BO's playground.
    Voters are the children. They believe in fantasies. They want fantasies to come true
    If you believe that statement which you obviously do as you wrote it You sir are in fantasy land.

  3. What about the approximately $250 billion per month in tax receipts? Prioritize by paying the debt service first each month, then there is no possibility of default. Their lies are just a scheme to frighten those beholden to the vagaries of the stock market and to promote more government control as a "solution".

  4. QE was supposed to have been a 1-time emergency measure to save all these Wall Street financial firms from collapse from the explosion of mortgage-backed securities fraud back in 2008.

    Every time they talk about tapering down or cutting QE off, the stock market tanks. There's no money to lend (to create more future debt slaves) because the large banks and Wall Street firms are using it to buy huge blocks of stock to keep the market propped up. Now they’re trapped!

  5. "The voters do not know how this is being done. They do not care. It’s all mere numbers for them. They assume that the laws of accounting do not apply to the source of the funding that the politicians have promised: pensions, health care, and safety nets for all. These are all free goods, as far as they are concerned. Nobody has to pay. It’s Tinker Bell economics."

    This paragraph, and the two following it, describe Shane to a tee.

  6. If the voters weren’t children why do they keep voting in the same trolls like McCain?