I fear for our nation. Nearly half of our people receive some kind of government subsidy. We have

grown weak from too much affluence and too little adversity.

I fear that soon we will not be able to defend our country from our sure and certain enemies. We have debased our currency to the point that even the most loyal citizen no longer trusts it.

The problems that face Washington—and America

American Crisis

-A Roman Senator in A.D. 63

Introduction The problems we face What drives these problems What can be done These problems may be financial, but

the base problem is a moral problem

THE PROBLEMS WE FACE

3 different ways for a government to get spending money.

Federal Taxes

0

500

1000

1500

2000

2500

3000

Tax Reciepts (in bil. $)In constant 2005 dol-lars

Federal Tax Receipts

Source: US Census Bureau

Federal Debt

Inflation Inflation is not

rising prices Inflation is an

increase in the supply of money that causes rising prices

Money is subject to the Law of Supply and Demand, just like any other object

Most harmful method of revenue Causes Boom-and-

Bust cycle Sneaky

Different measures of Money supply

Monetary BaseMZM measure of money supply

Money supply

DRIVING THE PROBLEMS

Federal Spending

0500

1000150020002500300035004000

Federal Spending

Federal SpendingIn con-stant 2005 $

Federal budget

National defense 19%

Interna-tional affairs

1%General

sci-ence, space,

and tech-

nology 1%

Energy0%Natural

re-sources

and envi-ron-

ment 1%

Agricul-ture1%

Transportation3%

Com-munity and re-gional devel-

opment 1%

Educa-tion, train-ing, em-ploy-ment, and

social ser-

vices4%

Health10%Medicare

12%

Income security 18%

Social security 19%

Veter-ans

benefits and ser-

vices 3%

Admin-istra-tion of justice

1%

General government1%

Net interest 5% Allowances

0%

Federal Budget 2010Source: US Census Bureau

Social Security Not an account It’s a piggybank for politicians

What we can do Focus has to be on cutting spending

If we focus on reducing one method of revenue, but don’t cut spending, then spending will just shift to the other methods of raising money

Entitlement programs must be severely overhauled

No easy answers

1976

Money Supply, MZM Federal Debt“In the case of the federal government, we can print money to pay for our folly for a time. But we will just continue to debase our currency, and then we will have financial collapse. This is the road we are on today. This is the direction in which the ‘humanitarians’ are leading us. But …There is nothing ‘humanitarian’ about the loss of freedom. That is why we must be concerned about the cancerous growth of government and its steady devouring of our citizens’ productive energy. That is why we must be concerned about deficits and balancing the budget. The issue is not bookkeeping, it is not accounting. The issue is the liberty of the American people.…I speak of this so insistently because I hear no one discussing this danger. Congress does not discuss it. The press does not discuss it. Look around us---the press isn’t even here! The people do not discuss it—they are unaware of it. No counterforce in America is being mobilized to fight this danger. The battle is being lost, and not a shot is being fired.”—Treasury Secretary William SimonApril 30th, 1976

Conclusion New birth in freedom