Category Archives: Debt

January 17, 2017

Beneficiaries of Entitlement Programs Skyrocked Under Obama (Video)

Beneficiaries of entitlement programs such as Medicaid, Medicare, Social Security, and food stamps greatly increased under the Obama administration, adding billions to the nation’s debt.

A recent report says the Supplemental Nutrition Assistance Program, a food stamps program, costs taxpayers $70,866,830,000 in 2016. Under the Obama administration, the number of people using food stamps went from 33,490,000 to 44,219,000.

The number Medicaid beneficiaries went from 60,880,000 in 2009, to 74,059,221 in 2016.

“Historically, Medicaid eligibility has generally been limited to low-income children, pregnant women, parents of dependent children, the elderly, and individuals with disabilities,” said the Congressional Research Service (CRS).

But this changed under the Obama administration. The organization went on to say, “However, the Patient Protection and Affordable Care Act (Obamacare) included the ACA Medicaid expansion, which expands Medicaid eligibility to individuals under the age of 65 with income up to 133% of the federal poverty level at state option.”

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December 5, 2016

Stanford Report: California Public Pension Debt Up 19% to $964.4 Billion

The latest report from Stanford University’s “U.S. Pension Tracker” reveals that the 2016 California Public Employee Pension Plan liability is up 19.4 percent to $964.4 billion.

CalPERS pension debt on a per household basis jumped $15,048 to $92,748 for the fiscal year ending June 30, 2016. Despite the grim number, Alaska actually won this year’s booby prize for the largest public debt per household at $110,538.

Pension Tracker’s is led by Joe Nation, Ph.D. and a distinguished group of Stanford University faculty members, including Nobel Prize winner William F. Sharpe. The team compiles and analyze actuarial, budgetary, demographic, and other financial data necessary to calculate U.S. public pension plan liabilities for each state.

Pension Tracker’s analysis is especially illuminating, because the researchers calculate pension liabilities on a “market basis,” to understand how many dollars that taxpayers would need to invest in 20-year risk-free Treasury Bonds at today’s current yield to earn enough money to pay their pension debt; and on the “actuarial basis” guestimate used by state and local pension plans somehow to assume that they can earn each year by making higher-risk stock, bonds and derivative investments.

Market Basis: Pension Tracker estimates California’s public pension assets if invested in risk-free 20-year maturity Treasury Bonds yielding a fixed yield of 2.75 percent, equals $92,748 per U.S. household — or $24,362 for every man, woman, and child in California.

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December 4, 2016

Report: Feds to Forgive At Least $108B in Student Loan Debt (Video)

The Government Accountability Office announced this week that at least $108 billion in student loan debt will be forgiven in the coming years. The move leaves taxpayers ultimately on the hook for the repayments in question.

“Government created a problem and now they’re making it worse,” Sabrina Schaeffer said.

The panel noted that President-elect Donald Trump may also forgive a portion of students’ debt.

Investments reporter Bill Baldwin suggest that, instead of having the government lend money to college students, the colleges themselves should take the financial chance on each student they admit.

Original source.

April 28, 2016

Why Sports Authority is throwing in the towel and closing all of its stores

“With the minimum wage going up to $15 an hour and more people turning to online shopping, more stores are going to close. It’s fine to say that everyone should have a living wage. But the money has to come from somewhere.” Phil Lempert, analyst of consumer behavior and marketing trends.

When struggling retailer Sports Authority filed for Chapter 11 bankruptcy last month in the face of more than $1 billion in debt, the company indicated that it had two options going forward.

One of those was to shed underperforming stores and emerge from bankruptcy as an intact, but pared-down company. The other was to sell everything and cease operating.

On Tuesday, the company appeared to choose the latter.

In a hearing in U.S. Bankruptcy Court in Wilmington, Delaware, an attorney for the Englewood, Colorado-based sporting goods chain indicated that the only option for the company was to close all of its stores.

“It has become apparent that the debtors will not reorganize under a plan but instead will pursue a sale,” said the attorney, Robert Klyman.

The abrupt abandonment of a reorganization plan follows Sports Authority’s announcement in March that it would close 140 of its 464 stores in the U.S. and Puerto Rico to help pay off $1.1 billion in debt.

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April 15, 2016

Obama Cronies Cash in on Puerto Rico Bailout

Amassing a $73 billion debt on an island of just three million people is quite an accomplishment. Borrowing more than $24,000 per resident ought to provide a platinum level of public services for the citizens of Puerto Rico. It has certainly provided platinum-level contracts for politically-connected consultants.

This week, Puerto Rico is begging the GOP Congress for help escaping its massive $73 billion debt obligation. House Speaker Rep. Paul Ryan is spearheading legislation that would allow the island territory to shed many of its debts in federal bankruptcy court. The island’s debt crisis has not stopped it from opening its wallet to former members of President Obama’s inner circle.

SKDKnickerbocker, the powerful communications firm headed by former Obama senior staffers Anita Dunn and Bill Burton, has a $3.4 million contract with Puerto Rico to handle public relations for the island’s current debt crisis. The contract includes up to $500,000 in paid advertising to promote a bailout of Puerto Rico.

Dunn was White House Director of Communications in the first Obama term. Burton was national spokesman for Obama’s first Presidential campaign.

Also handling parts of the Puerto Rico contract is Barbara Morgan, former spokesman for Rep. Anthony Weiner’s ill-fated mayoral campaign.

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April 3, 2016

Trump: I will eliminate U.S. debt in 8 years

Trump insisted in the interview that “renegotiating all of our deals” will help pay down the debt by sparking economic growth.

Donald Trump insists the he will be able to wipe out the United States’ debt in eight years.

The Republican candidate said in a wide-ranging interview with the Washington Post that he’d be able to get rid of the more than $19 trillion debt “over a period of eight years.”

Eliminating that amount of debt in eight years is highly impossible, according to most economists, the Washington Post reported. It could require using $2 trillion a year from the annual $4 trillion budget to pay off holders of the debt.

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March 14, 2016

Pensions Funds Turning America Into a Debtors Prison

“The creation of the mortgage bond market, a decade earlier, had extended Wall Street into a place it had never before been: the debts of ordinary Americans.” – Jared Vennett (played by Ryan Gosling), The Big Short (2011)

Along with another superbly authentic movie “Margin Call” (2011), “The Big Short” provides a vivid look into the rigged, Darwinian, ruthlessly exploitative circus popularly known as “Wall Street.” For decades, ever since the great depression, this industry slumbered along, sedately providing financial services to Americans. As always, it also was a venue for legalized gambling, but the number of players were limited, the winnings were relatively meager, and the opportunities for corrupt manipulations had not yet been multiplied by new trading technologies. Back then, the seedier aspects of Wall Street were overshadowed by the many vital services the industry provided. All of that changed starting around 1980.

In 1985, the financial sector earned less than 16 percent of domestic corporate profits. Today, it’s over 40 percent. These profits are made on the backs of American consumers who pay usurious rates for student loans and credit card debt, yet cannot earn more than a 1 or 2 percent on their savings accounts. America’s financial sector is grotesquely overbuilt, it has become a predatory force in the lives of most Americans, and the legitimate services as intermediaries that they actually provide – especially given the gains in information technology over the past 30 years – could easily be delivered for a fraction of the costs. Who benefits?

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February 15, 2016

Kanye West Tweets That He’s Millions Of Dollars In Debt

He also asked Facebook founder Mark Zuckerberg to invest one billion dollars in his ideas.

Kanye West sent out a tweet over the weekend claiming he’s millions of dollars in “personal debt.”

After the rapper appeared on “Saturday Night Live” and released his new album “The Life of Pablo,” he tweeted that he’s having big financial problems.

Original source.

January 3, 2016

Government Debt Bubble Is Based On Credit Theft

So all of these trillions of public debt, which benefit only public union employees, were created through what may be characterized as credit theft. This is because these debts are secured not by the assets of the city or the public union but by unknowing victims; the taxpayers.

Right now there are ten cities in Illinois where all of the property tax payments made by residents are used exclusively by the local city government to pay pensions and municipal bonds, the two biggest types of debt created by local and state government.

Illinois is not the only state that has public pension and municipal bond debt. All states and virtually all units of government have these types of debt. These debts are not trivial. The total amount of public pension and municipal bond debt was $8.3 trillion at the most recent reckoning. The largest part of this debt, the public pension debt, was created by government, to help only government employees.

In many localities the residents know that teachers, firemen and policemen collect pensions. But until recent years they often did not know how much money was involved in these pensions. What is worse is that they do not know that most of the money these public servants will receive in their pensions has to be paid for by the residents. It is not paid for with contributions made by the government employees themselves.

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November 10, 2015

Former GAO Chief: True National Debt $65T, Gov’t Spending Has ‘Lost Touch with Reality’

In a radio interview airing on Sunday, former U.S. Comptroller General and chief of the Government Accountability Office Dave Walker asserted that America’s national debt is over three times the official figure, which dramatically understates the government’s financial commitments.

Walker told host John Catsimatidis of AM-970 in New York, as related by The Hill:

If you end up adding to that $18.5 trillion the unfunded civilian and military pensions and retiree healthcare, the additional underfunding for Social Security, the additional underfunding for Medicare, various commitments and contingencies that the federal government has, the real number is about $65 trillion rather than $18 trillion, and it’s growing automatically absent reforms.

Like other critics of our rapidly inflating national debt, Walker warned it would have serious ramifications for both America’s economic health and national security. He explained:

If you don’t keep your economy strong, and that means to be able to generate more jobs and opportunities, you’re not going to be strong internationally with regard to foreign policy, you’re not going to be able to invest what you need to invest in national defense and homeland security, and ultimately you’re not going to be able to provide the kind of social safety net that we need in this country.

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