Federal government aims to bankrupt us all

USA Today came out with a troubling (but not unexpected) story stating that the federal government is way over its head in red ink -- so deep in debt that if you divvied it up among the population, the tab would be "nearly $500,000 per household."

D.C.'s estimated $57.3 trillion in liabilities (State and local debt raise the total to $61.7 trillion) comes courtesy primarily of those oh-so-popular entitlement programs that keep the population sucking at the government tit and voting for more. Medicare alone has an unfunded liability of $30.4 trillion.

For 2007 alone, liabilities soared by $2.5 trillion. That's just a tad higher than the official deficit of $162 billion.

The reason for the discrepancy: Accounting standards require corporations and state governments to count new financial obligations, even if the payments will be made later. The federal government doesn't follow that rule. Instead of counting lifetime benefits for programs such as Social Security, the government counts the cost of benefits for the current year.

The deteriorating condition of these programs doesn't show up in the government's bottom line, but the information is released elsewhere — in Medicare's annual report, for example.

So the $57.3 trillion figure comes from the apparently unprecedented tactic of applying generally accepted accounting standards to the federal books -- an approach strongly favored by the Institute for Truth in Accounting.

The USA Today report echoes what former U.S. Comptroller General David Walker has been saying for years. From U.S. News and World Report:

The problem is where we're headed in the $44 trillion-plus in unfunded obligations for Social Security and Medicare that's growing $2 trillion plus a year.... Cash is key. We are already negative cash flow for Medicare. We're going to go negative cash flow for Social Security within the next 10 years...though Social Security is not the real problem. It's healthcare that's going to bankrupt the country.

Walker went into more detail on 60 Minutes:

Walker prescribes a combination of spending caps and tax hikes to combat the pending fiscal apocalypse. The caps make sense to me, but the tax hikes are premised on the assumption that Congress and the White House won't simply piss away extra revenue, leaving taxpayers poorer and the fiscal situation worse than ever.

My solution? Liquidate the federal government and its assets, pay off the past-due bills, and start over again with something much smaller, less ambitious and significantly less expensive.