by banknotelover

Created on: April 16, 2009

I agree that the US government should be held to the same principles of good business management as a publicly held US corporation. In fact, it should be held to and run by the same principles of any other corporation in the world whatsoever. The US government has held public/national/federal debt since its founding in 1776, and has not had zero public/national/federal debt since January 8, 1835, and the national debt is increasing every second of the day, because the US government is running deficits every second of the day, with all the bailouts, Social Security, Medicare, and all other unfunded liabilities the government promises. If the US government was a publicly held US corporation, it would have gone bankrupt long before 2009, probably more than a century ago.

The current financial path taken by the US government is totally unsustainable. By promising Social Security, Medicare and other entitlement programs (which the Government Accountability Office (GAO) admitted in 2000 that are not backed by real, existing financial assets, the government is promising that it will go bankrupt. Where is the government going to get all the money to pay for these entitlement programs? By asking China, India and other countries to buy more US treasuries? One day all the other countries will realise that the US government is really an empty shell much like the Wizard of Oz, relying on endless deficit spending to pay for its liabilities, and if they stop buying US treasuries, Social Security and all other entitlement programs, the US will really go bankrupt, especially when the baby boomers start retiring, beginning from 2016, and government expenditures are already projected to exceed federal tax revenues sometime between 2030 and 2040 if what is going on now continues.

If the US government does not reform itself and the way it operates financially, the US government is on its way to destruction. The US government is not operating with good principles of good business management, and I would wager that more than half of US lawmakers are not well financially educated, and can even be considered financial dunderheads. If the US government is not bound by principles of good business management, it will continue on with its deficit spending, printing of currency, and bailing out companies such as General Motors, Daimler-Chrysler, Bear Stearns, and so on. All these bailouts are already running into the trillions, and are all taxpayers' dollars. If companies that are not run well and are financially ill go bankrupt or have to rely on the government to bail them out, what makes you think that the US government won't go bankrupt? And if you think a government cannot go bankrupt, think again. National bankruptcies have happened before, in Russia in 1998, Argentina in 1999-2002, and most recently in Iceland, where all three of its major banks collapsed in 2008. The then-Prime Minister, Geir Haarde, even admitted that in the worse case scenario, the Icelandic economy could have been sucked down with the banks and gone into national bankruptcy.

Therefore, the US government has to reform itself and be held to the same principles of good business management as a publicly held US corporation.

Learn more about this author, banknotelover.
Click here to send this author comments or questions.