I recently posted the horrifying statistics on government indebtedness: Washington D.C. has promised and is now legally obligated to provide $330,000 worth of benefits to every man, woman and child in America, benefits that at present it has no hope of being able to pay.
To simplify, the U.S. has income of $3 trillion a year, has racked up $500 billion in credit card debt each year for a total of nearly $10 trillion, and has made legally binding promises to spend 30 times its annual income, with no hope of getting a raise in the future.
Let's bring that down to scale.
Imagine your neighbor makes $50,000/yr, which just barely covers his mortgage payments, food, and medical care for the five members of his family, and has also charged up $8,350 per year on credit, for an outstanding total of about $150,000. He comes to you and says he wants to donate money to charity, and would like a $1.5 million loan to do so.
You chuckle and tell him to call Bill Gates.
Would Bill Gates loan him the money?
Suppose he uses the internet to con 1,500 people to loan him $1000 each, in loans which are legally collectable, and gets the $1.5 million he wanted. Now he comes to you -- with his $50k/yr job, wife and three kids, $150,000 in credit card debt, and $1.5 million in unsecured obligations, and wants a few thousand dollars from you to invest in "Green technology" -- unproven energy systems which he says will be great for the environment, and will provide jobs.
You should not lend this person any of your money.
I'm no investment expert, and you may want to check with your Certified Financial Planner, but my amateur investment advice to you is not to lend that fellow any of your hard-earned money for his "green technology" investment plans.
I hate to be so negative and unforgiving. You may know someone who has $20-50,000 in credit card debt, but they seem to have a stable income, and if they just tighten up their belt, you think they might be able to pay off their debts. You might even consider loaning them some money for their "green technology" scheme, provided they also take substantial steps to paying off their current debts.
But I'm talking about someone who has pretty recklessly racked up $2,000,000 in debt, with no prospects of being able to pay it off.
In my opinion (and I'm not a trained therapist), that person has a mental illness -- an obsessive spending/borrowing compulsion -- unless he is truly sociopathic (no sense of morals, ethics, or concern for others). This man's family is inevitably going to go through hard times.
Do you agree with me that you should not loan this man your money to "invest?"
This man is President Barack Obama.
And he doesn't just want your money. He's hitting up on 300 million other Americans.
Surely Obama knows that if he becomes President, he will inherit a Congress that has an income of less than $3 trillion, and spends $500 billion more than it takes in every year. It has also already made legally obligatory promises to pay every man, woman and child in America $330,000.
Nevertheless, Obama says he wants to "invest" $150 billion in energy.
• He also wants to "invest" in "foreign language training, cultural awareness, and human intelligence" for the military,
• as well as "greater investment in advanced technology . . . like Unmanned Aerial Vehicles and electronic warfare capabilities."
• For the Navy, he wants to "invest" in "smaller, more capable ships."
• He wants to "invest" $10 billion in "the Unemployment Insurance (UI) program,"
• as well as "invest" in "the Manufacturing Sector and Create 5 Million New Green Jobs."
• He says he will "create an Advanced Manufacturing Fund to identify and invest in the most compelling advanced manufacturing strategies."
• Obama will "invest in low emissions coal plants."
• He will "invest in America's highly-skilled manufacturing workforce and manufacturing centers to ensure that American workers have the skills and tools they need to pioneer the first wave of green technologies that will be in high demand throughout the world."
• "Obama will also create an energy-focused youth jobs program to invest in disconnected and disadvantaged youth."
• He will create "New Jobs Through National Infrastructure Investment" "by creating a National Infrastructure Reinvestment Bank to expand and enhance, not supplant, existing federal transportation investments."
• Obama will "Invest in the Sciences" by "doubling federal funding for basic research."
• "Barack Obama wants investments in a skilled research and development workforce."
• "Obama will invest $250 million per year" in "a national network of public-private business incubators."
• Obama will "Lower Health Care Costs by Investing in Electronic Information Technology Systems."
• "Barack Obama will invest $10 billion a year over the next five years to move the U.S. health care system to broad adoption of standards-based electronic health information systems...."
• He wants to "Invest in Climate-Friendly Energy Development and Deployment."
• He wants to "Invest in the development of the next generation of biofuels, including cellulosic ethanol."
• He wants to "Create a Clean Technologies Deployment Venture Capital Fund," which he wants you to fund with "an annual $10 billion investment for five years."
• He wants to "Invest in a digital smart energy grid."
• "An Obama administration will invest in human capital to ensure that our young people have the skills to fill the growing number of information technology jobs being created globally."
This man tells you that "As a share of the Gross Domestic Product, American federal investment in the physical sciences and engineering research has dropped by half since 1970," and urges you to step up to the plate.
• "Barack Obama wants investments in a skilled research and development workforce and technology infrastructure to be supported here in America so that American workers and communities will benefit."
• "Barack Obama is committed to investing in communities and people who have not had an opportunity to work and participate in the Internet economy."
• Obama wants to follow the model of FDR "in confronting capitalism's gravest crisis, when he forged the social safety net, built the Hoover Dam, created the Tennessee Valley Authority, and invested in an Arsenal of Democracy."
• He regrets he didn't come to you sooner, asking for money to invest: "We could have invested in innovation and rebuilt our crumbling roads and bridges."
But it's not too late:
• "We can start by investing $10 billion to guarantee access to quality, affordable, early childhood education for every child in America."
• "And while John McCain deserves credit for speaking out against the threat of climate change, his rhetoric is undercut by a record of voting time and again against important investments in renewable energy."
• "When I'm President, we will invest in research and development of every form of alternative energy – solar, wind, and biofuels, as well as technologies that can make coal clean and nuclear power safe."
Remember, this man has $150,000 in credit card debt, $1.5 million in personal loans, and he wants more money from you. Most of his past investments have floundered, and have been riddled with corruption, but he promises "too-good-to-be-true" results from his next investment.
Would you not agree that this is a madman?
But so is your current congressman, who repeatedly loans your money to one madman after another. Hundreds of times a year, knowing of the reckless and dangerous debts that have already been accumulated, he says, in effect:
By voting for this legislation I hereby affirm my belief that the information and knowledge possessed by me and 434 other Congressman-"investors" is greater than the collective knowledge and information possessed by a Free Market of 150 million individual investors, pension fund managers, insurance company executives, mutual fund administrators, and brokers, all of whom do not have the luxury of obtaining investment funds by passing a law, but must earn their investment dollars.