LOOKING AT WARREN/SANDERS PLANS—WHERE DOES THE $ COME FROM

Where would the funds come for the Democrats “free stuff”?

Some basic facts about our economy:

At the present time (August 2019) the USA GDP (gross domestic product) is estimated to be roughly $20 trillion dollars.  That is: 20 thousand piles of greenbacks in which each pile comprises one billion dollars.  Our GDP is a measure in dollars of the value of all the goods and services  the nation produces in all of its business activities in a year.  The USA is a leader in this category.  For comparison China’s GDP is about $ 13 trillion US dollars, Japan about $5 trillion, Germany about $4 trillion.  Our GDP number places us at the very top of all the nations in the world.  

In order to protect the country and its citizens and carry on the essential business of state, the US government in Washington DC  taxes individuals and businesses (mostly) based on their income.  US Federal revenue for 2019 is expected to be about $3.6 trillion dollars.   Thus we tax our businesses and individuals on average roughly at about 1/5 or 20% of our GDP.   

However, exigencies arise and plans are often unrealized so it is also estimated that at the end of the fiscal year we will have spent $4.6 trillion dollars more than we actually have.  Yes we spend about $1 trillion dollars more than we actually take in as revenue.  Let’s speak that.  We will spend about $1 trillion dollars that we do not have.  That figure —one trillion—is what is known as the “annual federal deficit”.  We must borrow that money from lenders far and wide.  Then pay them interest on the loan. 

These annual deficits are common and just as you might expect—they accumulate.  If, as in any working class house hold. no  one puts away money in the “cookie jar” for the rainy day and spend the family’s  entire revenue—there would be nothing left to pay off debts.  In that “spend thrift” household debts would tend to accumulate from year to year.  

Over the years and decades the US government has almost always run a deficit.  As a result the annual deficits (except for a few years in the ‘90s) have accumulated to the present time to  about  $20 trillion dollars. This amount is known as the federal debt.  And as you may have noticed, that deficit is about equal to our GDP.  

Thus we owe to our bond holders and other entities we are indebted to about the same amount as the value of all of goods and services  that we as a nation produce annually.  

To service that debt in 2019 it cost the USA about $400 billion dollars each year.  That is money that we have to pay to our bond holders for using their money.  If we keep up with our spending habits as they are—some estimate that by 2028–in less than a decade—that amount —the amount to service our debt—will rise to close to one trillion dollars.  Get the idea?

Recently our politicians of the left have been heard calling for massive increases in government spending.  Admittedly many of these proposals are attractive.  Free medical care, a $1000 bonus check for everyone one of us each month, free college, open borders to accept any and all with open arms, etc., etc.  According to several sources, as well as the authors of these plans—-but let’s take just the “for free government medical”  it would cost about $3 trillion dollars annually to implement the Warren-Sanders medical health care plan.  Let’s ignore the fact that most people now are happy with their employer provided plan —which they would have to give up, and concentrate on the cost.   

Where can we possibly get the funds—$3 TRILLION DOLLARS  FOR HEALTH CARE (LOOK BACK AT WHAT OUR 2019 TAX REVENUE IS)  to spend such an amount?

Where would the funds come to fund—the Green Revolution, free college for all, reparations for slavery, or health care for illegal immigrants, etc. etc. etc.  Nothing available for those promises.

We must keep in mind that we currently spend nearly one trillion dollars of tax revenue annually on wars, military hardware, care for veterans and salaries as well as maintenance of the largest military in the world and the 800-900 military bases we maintain world wide.  But even if we were to defund the entire military effort and divert the third of our tax revenue we spend on our military efforts around the world—-put it toward medical care  for all— we would not have the funds for the healthcare program the progressives envision.  Let’s not ignore the impossibility of implementing the other promises of the progressives or more importantly the nation’s other essential services would have to go begging.  

So clearly these Warren/Sanders ideas are “pie in the sky” from politicians on the make.  They are pulling the old snake oil salesmen’s tricks of time memorial—buy it now and tomorrow Ill be out of here and on the road.  For them its vote for me now and when I’m in office I’m sure to find reasons for not doing what I just said. 

Of course if elected they could massively raise our taxes, destroy our economy in the process, and expose us to world with a completely defunded USA military .