Owen's Already Owin'

Lee DeCovnick
My niece just had her second child, a beautiful bundle of smiles and soft blond hair, Owen. My wife and I were, of course, elated, at the new arrival. Yet I harbored a deep, unspoken concern that this country has already set substantial obstacles in front of this innocent boy.

The  CBO's February 5th report, "The Budget and Economic Outlook: Fiscal Years 2013 to 2023" estimates that today's Federal debt of $16.8 trillion will increase to $26.1 trillion by 2023, just 10 years from now. How does that breakdown in easily digestible terms? That's an increase of $9.3 trillion in 10 years. This works out to a chest clutching $77.5 billion in Federal debt every month or $2.55 billion in additional debt each day for the next 3,650 days.

What could you purchase for $2.55 billion?  How about ten Boeing 787 Dreamliners or the New York Yankees, plus four hundred shiny red Ferraris?

Owen's share of this debt is currently $53,674.  By 2023, and his 10th birthday, that will increase to around  $75,600, taking into account a modest increase in the country's population.

According to the CBO, at no point in the next 10 years do the politicians in Washington plan to actually reduce the principal balance of the Federal debt.  So by 2023, the annual interest expense, at a modest 4.5% rate, would run a whopping $418 billion a year, or $1.14 billion a day.

Owens's share of the interest payment in 2023 would run $3.27 a day. As a 10 year old, he could perhaps mow lawns or sell lemonade to pay for his share.

Unfortunately, Owen also lives in California. From the LA Times:

The state of California's real unfunded pension debt clocks in at more than $500 billion, nearly eight times greater than officially reported.

That's the finding from a study released . . . [April, 2010] by Stanford University's public policy program, confirming a recent report with similar, stunning findings from Northwestern University and the University of Chicago.

To put that number in perspective, it's almost seven times greater than all the outstanding voter-approved state general obligation bonds in California.

How did we get here? The answer is simple: For decades -- and without voter consent -- state leaders have been issuing billions of dollars of debt in the form of unfunded pension and healthcare promises, then gaming accounting rules in order to understate the size of those promises.

With 40 million folks in California, Owens's current share of California's $500 billion in unfunded pensions and healthcare costs already runs $12,500. 

According to CalTax.org, Californians pay the highest state sales tax rate in the nation, the highest gasoline taxes in the nation, and the highest top rate of personal income tax in the country. Also from CalTax.org, "More than 500 chief executive officers in American businesses said California's regulations, tax policies, work force quality, education resources, quality of living and infrastructure make this state the worst state in which to conduct business."

So who is going to pay for the half a trillion dollars shortfall in pension benefits and healthcare liabilities? Unlike the greedy bastards in Congress and the White House, the California legislature can't print money or else they would have already. California businesses?  Not likely, who would want to open a business here?  California taxpayers, who are already the most heavily taxed in the nation? Not likely either. But the elected clowns in Sacramento honestly don't give a damn about business or taxpayers, otherwise that would have already changed the current business climate and lowered sales and gas taxes.  However, that will happen eventually; after the last California business has closed and the last working taxpayer realizes he must pay the state more than he earns each year. Not one second before.

We have heavily mortgaged our children's and our children's children future.  This massive avalanche of debt has become a permanent cancer, devouring our choices to invest in this nation's future. Politicians of both parties, who have abetted this travesty of basic economics, are squarely to blame as are the voters whose greed and avarice overcame their personal experience: that there is "no free lunch." 

Our crushing debt, Federal and State, is morally reprehensible. It is an abdication to a bankrupt Marxist/socialist ideology that has repeatedly enslaved entire nations . . . Russian, China, Cuba, Venezuela for starters.  Owen deserves a chance to create a better future for his children, to leave this country in better shape then when he arrived. He deserves that opportunity, but he will not have it unless we stand firm and fight the malevolent forces now choking our freedoms with red tape and bureaucratic fiat. If we allow the false gods of an overreaching cradle to grave "benevolent" government to rule our existence, to become financially enslaved, our lives become as disposable as Owen's diapers.

My niece just had her second child, a beautiful bundle of smiles and soft blond hair, Owen. My wife and I were, of course, elated, at the new arrival. Yet I harbored a deep, unspoken concern that this country has already set substantial obstacles in front of this innocent boy.

The  CBO's February 5th report, "The Budget and Economic Outlook: Fiscal Years 2013 to 2023" estimates that today's Federal debt of $16.8 trillion will increase to $26.1 trillion by 2023, just 10 years from now. How does that breakdown in easily digestible terms? That's an increase of $9.3 trillion in 10 years. This works out to a chest clutching $77.5 billion in Federal debt every month or $2.55 billion in additional debt each day for the next 3,650 days.

What could you purchase for $2.55 billion?  How about ten Boeing 787 Dreamliners or the New York Yankees, plus four hundred shiny red Ferraris?

Owen's share of this debt is currently $53,674.  By 2023, and his 10th birthday, that will increase to around  $75,600, taking into account a modest increase in the country's population.

According to the CBO, at no point in the next 10 years do the politicians in Washington plan to actually reduce the principal balance of the Federal debt.  So by 2023, the annual interest expense, at a modest 4.5% rate, would run a whopping $418 billion a year, or $1.14 billion a day.

Owens's share of the interest payment in 2023 would run $3.27 a day. As a 10 year old, he could perhaps mow lawns or sell lemonade to pay for his share.

Unfortunately, Owen also lives in California. From the LA Times:

The state of California's real unfunded pension debt clocks in at more than $500 billion, nearly eight times greater than officially reported.

That's the finding from a study released . . . [April, 2010] by Stanford University's public policy program, confirming a recent report with similar, stunning findings from Northwestern University and the University of Chicago.

To put that number in perspective, it's almost seven times greater than all the outstanding voter-approved state general obligation bonds in California.

How did we get here? The answer is simple: For decades -- and without voter consent -- state leaders have been issuing billions of dollars of debt in the form of unfunded pension and healthcare promises, then gaming accounting rules in order to understate the size of those promises.

With 40 million folks in California, Owens's current share of California's $500 billion in unfunded pensions and healthcare costs already runs $12,500. 

According to CalTax.org, Californians pay the highest state sales tax rate in the nation, the highest gasoline taxes in the nation, and the highest top rate of personal income tax in the country. Also from CalTax.org, "More than 500 chief executive officers in American businesses said California's regulations, tax policies, work force quality, education resources, quality of living and infrastructure make this state the worst state in which to conduct business."

So who is going to pay for the half a trillion dollars shortfall in pension benefits and healthcare liabilities? Unlike the greedy bastards in Congress and the White House, the California legislature can't print money or else they would have already. California businesses?  Not likely, who would want to open a business here?  California taxpayers, who are already the most heavily taxed in the nation? Not likely either. But the elected clowns in Sacramento honestly don't give a damn about business or taxpayers, otherwise that would have already changed the current business climate and lowered sales and gas taxes.  However, that will happen eventually; after the last California business has closed and the last working taxpayer realizes he must pay the state more than he earns each year. Not one second before.

We have heavily mortgaged our children's and our children's children future.  This massive avalanche of debt has become a permanent cancer, devouring our choices to invest in this nation's future. Politicians of both parties, who have abetted this travesty of basic economics, are squarely to blame as are the voters whose greed and avarice overcame their personal experience: that there is "no free lunch." 

Our crushing debt, Federal and State, is morally reprehensible. It is an abdication to a bankrupt Marxist/socialist ideology that has repeatedly enslaved entire nations . . . Russian, China, Cuba, Venezuela for starters.  Owen deserves a chance to create a better future for his children, to leave this country in better shape then when he arrived. He deserves that opportunity, but he will not have it unless we stand firm and fight the malevolent forces now choking our freedoms with red tape and bureaucratic fiat. If we allow the false gods of an overreaching cradle to grave "benevolent" government to rule our existence, to become financially enslaved, our lives become as disposable as Owen's diapers.