Much of the public focus is on the nation's public debt, which is $14.3 trillion. But that doesn't include money guaranteed for Medicare, Medicaid and Social Security, which comes to close to $50 trillion, according to government figures.Knowing this, Grass asks a salient question about who is going to buy all that debt.
The government also is on the hook for other debts such as the programs related to the bailout of the financial system following the crisis of 2008 and 2009, government figures show.
Taken together, Gross puts the total at "nearly $100 trillion," that while perhaps a bit on the high side, places the country in a highly unenviable fiscal position that he said won't find a solution overnight.
"To think that we can reduce that within the space of a year or two is not a realistic assumption," Gross said in a live interview. "That's much more than Greece, that's much more than almost any other developed country. We've got a problem and we have to get after it quickly."
"Why wouldn't an investor buy Canada with a better balance sheet or Australia with a better balance sheet with interest rates at 1 or 2 or 3 percent higher?" he said. "It simply doesn't make any sense."If Greece collapses, Germany and other European countries may bail it out. But no country or group of countries would be able to bail the U.S. out if our economy collapsed and we couldn't pay our liabilities.
Ponder that situation for a few scary minutes. Then ponder our nation's leader who is evading that question and then making jokes about how shovel-ready projects weren't actually shovel ready. Many people warned about that at the time, but Obama ignored such warnings because they didn't fit with his ideological certainty about how throwing government money away in stimulus was the right way to spur employment. He figured that Nancy Pelosi and Harry Reid knew best on how to craft such a solution. And now he's joking about how ignorant he was.
Just imagine the jokes he can make when he comes to truly understand the financial calamities we're facing in the not-so-far future.