By Gary North
UNFUNDED LIABILITIES
''Why do I believe this? Because I believe in the analysis supplied by Professor Lawrence Kotlikoff of Boston University. Each year, he analyzes the statistics produced by the Congressional Budget Office on the present value – not future value – of the unfunded liabilities of the U.S. government. The latest figures are up by $11 trillion over the last year. The figure today is $222 trillion.
This means that the government needs $222 trillion to invest in private capital markets that will pay about 5% per year for the next 75 years.
Problem: the world's capital markets are just about $222 trillion. Then there are the unfunded liabilities of all other Western nations. These total at least what the U.S. does, and probably far more, since the welfare state's promises are more comprehensive outside the USA.
Conclusion: they will all default.''
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