The total liabilities of the United States government, including future social security and medicare payments that the U.S. government is already committed to pay out, now exceed 65 trillion dollars, which is more than the entire GDP of the whole world.

According to the 2008 Financial Report of the United States Government, an official United States government report, the U.S. actually had a budget deficit of 5.1 trillion dollars in 2008.

So why did the Congressional Budget Office report that the federal budget deficit was only 455 billion dollars (which is certainly a total disaster) in 2008?

The difference lies in accounting. The CBO’s figures are based on cash accounting, while the 2008 Financial Report of the United States Government is based on GAAP accounting. GAAP accounting is what is used by all the major firms on Wall Street and it is regarded as a much more accurate reflection of financial reality.

So why is there such a big difference?

Well, what the Congressional Budget Office does is some really bad accounting. When you pay social security taxes, the federal government takes that money and instead of putting it away to pay your social security benefits in the future, it takes that money and spends it however it wants.

So what about the future social security and medicare benefits that the government owes you?

There is no money there for those payments.

The government is using that money right now to make the budget look better.

That’s right, you have been conned.

And as bad as the numbers from 2008 look, they do not reflect any significant money from the monstrous financial bailouts that Congress has passed.

So 2009 is going to look MUCH worse.

Pretty picture, eh?

The reality is the the United States of America is a total financial disaster.

Already, 13 banks have already failed in 2009. All of the bailouts certainly don’t seem to be helping much yet.

But that doesn’t mean that the federal government is going to give up trying to help. It seems a new “bailout” or a new “stimulus” is being passed almost weekly now.

Instead of accepting the fact that we must adopt a lower standard of living and deal with the reality of our massive debt, the politicians are trying to crank up the debt spiral one more time.

All of this government spending will help the economy in the short term, but it will make the long term problems of the U.S. government far worse.

Who is going to buy all of this new government debt? China has doubts about who is going to buy all of America’s new debt. The reality is that the only way that the government can “bailout” anyone or pay for any “stimulus” bill is to borrow.

America borrows and borrows and borrows.

If your personal finances were like that, how do you think it would end?

Ah, you are starting to get the picture…..

The “American Dream” is becoming the “American Nightmare” and the politicians don’t have a clue.

What are you going to do when the economy collapses and everything you ever worked for starts coming apart?

It’s time for all of us to start thinking about what is truly important…..

Here’s a statistic that should give us all pause: The average credit card debt of seniors grew by 26% between 2005 and 2008, CreditCards.com reports. For the rest of us, the increase was a comparatively modest 3%.

Also, according to a study released in July 2009 by New York City-based Demos, a public policy group, consumers 65 and older carried $10,235 in average card debt last year. That is a lot.

that’s very troubling now that so many retirees are living on Social Security and no other savings, and face medical expenses despite government-run Medicare. The dreaded “doughnut hole” is just a drop in the bucket compared with the other potential health care-related demands on their money.

Many older folks are stretched thin. That’s true in better times, but now, because retirement savings for lots of people have shrunk, they’re turning to credit.

Medical expenses are a burden. The Demos study says, “Older households, those 65 and over, reported the highest amount of credit card debt due to medical expenses: $3,988.”
They’re victimized. Consider how vulnerable people who didn’t grow up in the computer age are to phishing and other forms of identity theft. Scammers love seniors. And then there’s all the “free” stuff that’s advertised as a way for unscrupulous companies to start billing your credit card.
What to do? Be on the lookout for signs that seniors you know are struggling. Yes, this is difficult. If you don’t have a close relationship that allows discussion of such things, you’re going to have to be very observant.

Are your parents suddenly living beyond their means?
Are their bills piling up on the kitchen table — unopened?
Are they using a credit card to purchase things they used to pay for with cash, like groceries?
How to proceed? If you can have a frank, respectful discussion, do so. If the topic would be unwelcome, enlist help from other family members or friends.