Joblessness-A Byproduct of USAPonzi
Who Needs a Job in a Ponzi Economy?
As Laundering Money demonstrates, USAPonzi creates an exponentionally increasing GAAP-basis Deficit which in turn is creating an increasing amount of Supplemental Income for each U.S. citizen as demonstrated in Living Beyond our Means. This Supplemental Income was $21,019 in fiscal year 2012 and has averaged $16,000 over fiscal years 2008-2012. While it is clear that this money is not going directly to each citizen, our social benefit programs are promising benefits that in many cases approach or even exceed the compensation that many citizens can realize from the currently available jobs for which they might be qualified. As a result many people, of working age and especially those nearing retirement age, are dropping out of the workforce and choosing to live on Government provided social benefits. Of course the problem with this result is that the Government will not have the money to continue paying these social benefits at the current promised levels. When the Government is forced to default on these commitments the source of income that these workforce dropouts are expecting will be reduced or vanish and these dropouts will eventually have to go back to work likely at markedly reduced wages.
A large portion the dramatic GAAP-basis Deficit spending that is produced by USAPonzi is continuing to increase exponentially (see Laundering Money ). In fiscal year 2012 GAAP-basis Deficit spending was $6.6T and our GDP was $15.51T, therefore this GAAP-basis Deficit was 42.6% of U.S. GDP ( $6.6T/$15.51T=0.426). This 42.6% of GDP does not require workers, we just borrowed or "virtually borrowed" that money and spent it. The portion of the GDP that is delivered by the "Real" economy (the other 57.4% of GDP) needs fewer U.S. workers to produce our "Real" economic output since more and more routine jobs are being automated, many highly skilled manufacturing jobs have transitioned to lower cost countries, and now moderately skilled and even highly skilled "high tech" and service industry jobs are also being outsourced. Because of the way USAPonzi works, in the limit condition very few people will need to work and we can just print dollars to distribute to social benefit receipients. Of course we will never approach this limit condition since either the leadership in Washington will come to their senses or the financial markets will demand that action be taken to resolve this problem when USAPonzi begins to require the printing of even more dramatic amounts of money than the Federal Reserve is printing today.
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