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News Link • Government Debt & Financing

America is Bankrupt: U.S. Deficit Really $202 Trillion, Kotlikoff Says

“Congress has engaged in Enron accounting,” says Kotlikoff, who recently penned an op-ed for Bloomberg entitled: The U.S. Is Bankrupt and We Don't Even Know It. Yet, the debt market continues to have an insatiable appetite for U.S. Treasuries; heading into Monday's session, the yield on the 30-year Treasury bond (which moves in opposition to its price) was at its lowest level since April 2009. Kotlikoff says that's because the market is focused on the "mole hill" of official debt. In time, the U.S. will have a major inflation problem to rival that of Germany's post World War I Weimar Republic, he predicts. “We have to think about the fact that unless the government gets its fiscal act in order we’re going to have the government printing lots and lots money to pay these enormous bills that are coming due over time.” America is in need of major reform of the health-care, retirement, tax and financial system, Kotlikoff continues. “We need (to perform) heart surgery on this economy, not putting on more band-aids which is what we’ve been doing.” Barring that, your hard-earned dollars will soon be worthless, he declares.

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