‘Fiscal bomb’: Around 45% of UK graduates cannot pay back student loans

RT | Government estimates around 45 percent of graduates will be unable to pay back their loans.

CHANGE: 2 simple charts illustrate the imminent fiscal destruction of the United States

While low-information voters and progressives never seem to think ahead more than a day at a time, thoughtful and concerned citizens know what’s coming.

With all the talk of tapering and expected hikes in interest rates by the Fed, inquiring minds are likely interested in what happens to interest on the national debt if the Fed ever does hike…

…the current blended rate of interest on the national debt is a mere 2.4% according to the CBO…

The “optimistic” projection of $ 668 billion assumes the rate will stay below 3.1% through 2020.

With that in mind, please consider the Fed’s ‘hidden agenda’ behind money-printing.

One of the most important reasons the Fed is determined to keep interest rates low is one that is rarely talked about, and which comprises a dark economic foreboding that should frighten us all.

How would you feel if you knew that almost all of the money you pay in personal income tax went to pay just one bill, the interest on the debt? Chances are, you and millions of Americans would find that completely unacceptable and indeed they should.

…isn’t it fair to ask what the interest cost of our debt would be if interest rates returned to a more normal level? What’s a normal level? How about the average interest rate the Treasury paid on U.S. debt over the last 20 years?

That rate is 5.7 percent, not extravagantly high at all by historic standards [and if] we were to pay an average interest rate on our debt of 5.7 percent, rather than the 2.4 percent we pay today, in 2020 our debt service cost will be about $ 930 billion.

Now compare that to the amount the Internal Revenue Service collects from us in personal income taxes… In 2012, that amount was $ 1.1 trillion, meaning that if interest rates went back to a more normal level of, say, 5.7 percent, 85 percent of all personal income taxes collected would go to servicing the debt. No wonder the Fed is worried.

You can see why rational economists (i.e., not economedian Paul Krugman) believe that the Federal Reserve has painted itself into a corner.

Tapering its asset purchases will result in (perhaps sudden) interest rate spikes, which will quickly bankrupt the country.

Failing to taper will continue to devalue the dollar until bond buyers recognize that the debts will never be repaid, at which point interest rates will enter the death spiral vortex.

Got Cloward-Piven?

Hat tip: BadBlue Real-Time News

Doug Ross @ Journal

RUH ROH: Harvard Study Suggests Youth Are Shunning Obamacare; Fiscal Death Spiral Awaits

Guest post by Eric Boehm

Obamacare is striking out with young people — those healthy folks who are suppose to actually make it work.

Young people are perhaps the most important demographic to the success of the Affordable Care Act, but most Americans under 30 are opposed to the law. They particularly dislike the individual mandate that requires them to buy insurance or pay fines in form of higher taxes.

A new survey from Harvard University found a large majority of young Americans do not believe the law will save them money, do not believe it will improve their health and do not intend to sign up for insurance through the new exchanges.

If that’s all true – particularly the last part – it is very bad news for President Barack Obama’s signature policy achievement.

The Affordable Care Act hinges on getting young, mostly healthy people to sign up for insurance. That will help spread out the costs incurred by the older, more expensive enrollees who also will use the system.

This cost-pooling is central to the economics that underpin the law, and if young people decline to enroll, costs for everyone else could skyrocket.

The data from the survey demonstrates a striking rejection of the ACA by millennials under 30,” wrote John Pulice of the Harvard Political Review, which provided analysis of the survey.

The 2013 Harvard Public Opinion survey included interviews with 2,089 Americans between the ages of 18 and 29. Interviews were conducted between Oct. 30 and Nov. 11, and the poll has a margin of error of 2.1 percent.

The results show many young people are not buying the promises of Obamacare. A mere 17 percent of those polled believe their quality of health care will improve under the Affordable Care Act, while 44 say it will get worse.

But millennials’ views on health care costs are even bleaker.

Only 10 percent of those surveyed said the ACA will decrease their health care costs, with 50 percent saying it will increase their costs and 36 percent expecting their costs to stay the same, according to the Harvard poll.

Of those surveyed, only 20 percent said they plan to enroll in a health care plan through an exchange, while 47 percent said they would not enroll.

Elise Wilkinson, a 25-year-old who recently graduated from Quinnipaic Law School in Connecticut, said her biggest worry about Obamacare is the uncertainty of everything. She’ll be off her parents’ health plan in less than a year and expects to see high premiums.

“I also see a lot of friends around my age who are seeing their plans go up in cost while either adding nothing or requiring add-ons they don’t want or need,” she told Watchdog.org. “It makes me foresee high costs in my future.”

With young people being such an important demographic for Obamacare’s success, both sides have focused outreach efforts on millennials.

The anti-Obamacare group Generation Opportunity has run a series of web advertisements featuring a “creepy Uncle Sam” posing as a doctor. The group wants to get young people to “opt-out” of Obamacare by telling them upfront about the costs and consequences of signing up for insurance through the exchanges.

“Obamacare’s success depends on millions of young people paying three times more for insurance so older people can pay slightly less. It’s a generational game rigged against us, and we’re not interested in playing,” Evan Feinberg, the group’s president, said in a statement.

The White House has taken notice. Obama recently took a thinly-veiled shot at Generation Opportunity’s outreach efforts.

“That’s a really bizarre way to spend your money, to try to convince people not to get health insurance, not to get free preventive care, not to make sure that they’re able to survive an accident or an illness,” Obama said of the group’s advertisements and college campus visits with their big-headed Uncle Sam mascot.

While speaking to a crowd of youth activists, Obama made the case for why young people should sign up for health insurance.

“If you get sick, and you get to the hospital and you don’t have any coverage, then somebody else is also going to be paying for it,” he said.

Pro-Obamacare groups like Progress Now also have crafted ads aimed at young people.

In one, college students are told to sign up for Obamacare so they can have access to contraception for post-party hookups. Another warns of injuries from keg stands and suggests that buying insurance through Obamacare is the best solution – instead of, perhaps, suggesting that binge drinking might be a problem.

But the Harvard poll shows many young people can see through those efforts, and the numbers indicate millennials are right to be worried about the cost of health insurance and the transfer of wealth from one generation to another.

On the federal and state-based health insurance exchanges, the biggest premium hikes are for those under 27, according to research from the conservative Heritage Foundation.

And critics say the fundamental premise of the health care law, which depends on young people helping offset the cost of older enrollees, continues a trend that has been rolling along for a while.

According to the Pew Research Center, households headed by people 65 or older had 10 times the wealth of households headed by people under 35, in 1984.

By 2009, that gap had increased to the point that households headed by people over 65 had 47 times the wealth of households headed by people under 35.

The number of people under 35 living in poverty, meanwhile, is double the number of poverty-stricken senior citizens, according to the same data.

Boehm is a reporter for Watchdog.org and can be reached at EBoehm@Watchdog.org. Follow him on Twitter at @EricBoehm87. Related: The Real Life of Julia

Doug Ross @ Journal

Tribune Expose: 12 Horrifying Secrets of Chicago’s Imminent Fiscal Collapse  

The Chicago Tribune has published a special report (subscription required) that offers a stunning glimpse into the Second City’s true financial situation — peeling back the obfuscation and misdirection offered by the corrupt Democrat hacks who have run the city for the last century.

Its report is worth reading in its entirety, but 12 salient details summarize the imminent collapse of Chicago’s finances:

• Chicago has more general obligation debt per capita than any of the 10 largest U.S. cities except New York

• Chicago even has more general obligation debt per capita than Detroit

• When the city does reveal its spending plans to the public, the information often turns out to be inaccurate or misleading

• 63 percent of all property taxes went to debt payments last year

• The dependence on bond money has created a massive debt burden even as the city wrestles with chronic deficits and a pension crisis. Chicago’s outstanding debt on general obligation bonds has quadrupled during the past 18 years, reaching $ 7.2 billion last year. With interest, that amount nearly doubles.

• Most of Chicago’s debt woes can be traced to the long reign of former Mayor Richard M. Daley, but the borrowing he relied on so heavily has continued under Rahm Emanuel.

• The billions in bonds issued under Daley allowed him to cut ribbons, plant trees and hand out large contracts — helping him become the longest-serving mayor in Chicago history.

• The Tribune provided former mayor Daley details on its analysis, but he declined repeated requests for interviews.

• Rahm Emanuel has done virtually nothing to address the situation since taking over as Mayor. Just like Daley, Emanuel has used bond money for short-term budget relief.

• Chicago leaders routinely use bond proceeds to make interest payments on the bonds themselves, borrowing more than $ 450 million since 2000 just to pay interest.

• Daley and Emanuel have used $ 1 billion in bond money to pay for legal judgments and settlements. The practice not only forces future generations to pay a huge price for the city’s misdeeds but also is likely illegal under the tax code.

• For a series of bond issues, Rahm Emanuel’s team had to pay higher interest rates than most of the bonds they replaced; they did so to push payments out to the year 2039 (an expert says “this suggests the noose is tightening”). It also means taxpayers in 2039 will be paying off bonds from 1993. Some of that original money went into public housing that was torn down more than a decade ago.

Ain’t the infernal alliance of public sector unions and Democrat hack politicians great?

In the ongoing battle between mathematics and Democrats, math has extended its perfect record to about 75 bazillion to zero. But, hey, ain’t you Chicagoans happy you voted to keep Sandra Fluke’s flush with contraceptives?

Hat tip: BadBlue 24×7 News Service.

Doug Ross @ Journal

Larwyn’s Linx: GOP “Doomsday” plan for fiscal cliff spells doom…for GOP

Send us tips! Bloggers: install a Larwyn’s Linx widget. Get real-time news, 24/7, at BadBlue.


GOP “Doomsday” plan for fiscal cliff spells doom for the GOP: WyBlog
Night of the Dull Knives: Camp o’ the Saints
Shocking: House Republicans Cave on Taxes, Entitlements: Foundry

Mark Levin goes Nuclear on John Boehner: Scoop
Future Generations: Williams
Boehner tax increase sparks conservative backlash: Times

Master of the plausible lie: Sowell
Christmas for Obama Bundlers: Malkin
Ryan: We’re Further From Agreement Than When We Started: Ace


Let’s Be Honest, Call Modern Democrat Party The Socialist Party: CFP
Taxes hikes are a distraction. It is all about spending.: FW
Obama Is A Man Who Has Never …: Boortz

SoCal Port Strike Costs $ 1B a Day; Clerks Reject $ 190K Offer: RS
Doing just fine! Obama says ‘economy is poised to take off’: Twitchy
The Left’s Flip-Flop on the Bush Tax Cuts: American

Scandal Central

With Purge, House GOP Leadership Reaches New Low: Cato
House GOP Leaders Purged Conservatives Using Secret List: Breitbart
Rep. Justin Amash slams GOP leadership: ‘They booted me for working to reduce debt’: Twitchy

Climate & Energy

How A Spanish Scam Artist Punk’d The Ukraine For $ 1.1 Billion: ZH
Oyster Farm Loses To Federal Bullies And Eco-Fanatics: IBD


Meet the Press, Check the Facts: Cato
Gergen: Democrats would rather humiliate GOP than solve fiscal cliff: Hot Air
Michael Moore received $ 841,145 in incentives to film anti-corporate welfare documentary in Michigan: Exam

Barack Obama thinks cable news is the devil, long live cable news: NakedDC
Dumb Statement From Romney Advisor Stuart Stevens: Ace
Piers Morgan never saw it coming.: Gun Free Zone

Costas: Gee, Maybe My 20-Second Easy-Bake Gun Control Screed Wasn’t Appropriate: Ace
Americans oppose Obamacare by 10 point margin: WS
‘Reporter’ Kelly O’Donnell: Squee! Obama sat next to a GOP girl governor at meeting; secret message?: Twitchy


All Class: Obama Says Republicans, Not al Qaeda, Are Top National Security Threat: Beacon
CAIR Takes Out Full-Page Ad Calling For “Improved Relationship” With Republicans: WZ
“A protest by tens of thousands of Egyptians outside the presidential palace in Cairo turned violent”: AP

Obama’s Bestest Pal In Cairo Flees His Pharaoic Palace As Demonstrators Battle Police: Ace
The Russian Limbaugh: Cube
Did You Hear Gen. Boykin’s Warnings about Obama’s Brand of Marxism?: NoisyRm

Sci-Tech (courtesy BadBlue.com/Tech)

Google Deserves Our Gratitude; FTC Deserves Our Condemnation: ObjStd
Irrelevancy Leads to Failure – Worry for Yahoo, Microsoft, HP, Sears, etc.: InnovExc
Windows 8 Flops: Twitchy


Benghazi => ‘High On A Mountaintop’: RSM
PETA Crashes Biker Gathering… Not to be missed…: Steady Drip
Diplomacy In the Age of Nuclear Wintour: MOTUS

Image: Chicago Teachers Union VP Busted Participating in Midwest Marxism Conference
Today’s Larwyn’s Linx sponsored by: Tell John Boehner To Stop Purging Fiscal Conservatives!

QOTD: “This isn’t rocket science. Everyone knows that when you take money out of the economy, it destroys jobs, and everyone knows that when you give politicians more money, they spend it. This is why Republicans must oppose tax increases and insist on real spending reductions that shrink the size of government and allow Americans to keep more of their hard-earned money.” —Jim DeMint

Doug Ross @ Journal