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Jennifer is Co-host of The Story of Liberty Radio Broadcast, video editor and creator, blogger & Web designer for the Story of Liberty. TheStoryofLiberty.net

Bernanke to Congress: We’re Much Closer to Total Destruction Than You Think

If Bernanke is saying this, (which most of us have been saying for years), you know its time to prepare yourselves for the future.

CNBC Reported: “Official Congressional budget estimates understate the peril of rising debt, Fed chair Ben Bernanke told the Budget Committee on Capitol Hill today.

Warning that our nation’s fiscal health has deteriorated appreciably since the onset of the financial crisis and the recession, Bernanke called upon lawmakers to confront the long term fiscal challenges sooner rather than later. If lawmakers don’t confront them, they’ll find themselves confronted by them.

From Bernanke’s prepared remarks:

By definition, the unsustainable trajectories of deficits and debt that the CBO outlines cannot actually happen, because creditors would never be willing to lend to a government with debt, relative to national income, that is rising without limit. One way or the other, fiscal adjustments sufficient to stabilize the federal budget must occur at some point. The question is whether these adjustments will take place through a careful and deliberative process that weighs priorities and gives people adequate time to adjust to changes in government programs or tax policies, or whether the needed fiscal adjustments will come as a rapid and painful response to a looming or actual fiscal crisis.

Here’s Bernanke on the effect of rising debt:

Sustained high rates of government borrowing would both drain funds away from private investment and increase our debt to foreigners, with adverse long-run effects on U.S. output, incomes, and standards of living. Moreover, diminishing investor confidence that deficits will be brought under control would ultimately lead to sharply rising interest rates on government debt and, potentially, to broader financial turmoil. In a vicious circle, high and rising interest rates would cause debt-service payments on the federal debt to grow even faster, resulting in further increases in the debt-to-GDP ratio and making fiscal adjustment all the more difficult.

In short, the official estimates members of Congress hear from their budget office are under-estimating our dire economic predicament. If fiscal policy is not brought under control, things will be much, much worse.

Read article: http://www.cnbc.com/id/41491193/

From The Story of Liberty Radio Broadcast:
Economic Liberty
Principals of Economic Liberty
“There are few situations more interesting to the human race than the economy of America this day presents”
America is still the most prosperous and greatest nation on the planet, but much work needs to be done to keep her as a thriving nation. We can do it.
Remember people made America what it is today, and we can make it what it ought to be. Christians believe that.”

Want to learn more about Christian Economics? Go to: http://thestoryofliberty.net/

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3 Comments on “Bernanke to Congress: We’re Much Closer to Total Destruction Than You Think”

  1. WeZee April 13, 2012 at 3:37 am #

    talk to Hilary Clinton about how broke we are…and u will see her laugh in your face…she gives millions of our money away every week to other countries….and thats how i know you are lying about being broke…

  2. Greatscott April 14, 2012 at 9:02 am #

    Either Helicopter Ben is buttering us up for massive tax increases and austerity, or the dollar is about to “pop” like a needle into a baloon.

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