22 Reasons Your Taxes Will Increase Dramatically

The American economy is in trouble, and that means taxes will have to go up to compensate despite any contrary arguments. America’s debt now exceeds $50 trillion, more than the GDP of every economy on the planet. Market Watch’s Paul Farrell outlines 22 reasons a giant tax bomb is waiting to be dropped on the country’s consumers.

  1. Federal Budget Deficit – Government debt is now $11.5 trillion, or 100% of our GDP.
  2. Social Security needs money – We either must cut benefits or pay more taxes to compensate.
  3. Medicare needs money – It will be unfunded by 2016, and will take 100% of tax revenues by 2075.
  4. Health insurance liabilities – Costs are rising at double the rate of inflation, and there are plans for universal health care to cover this $2.5 trillion business.
  5. Military defense costs – There are wars being fought in Afghan and Iraq.
  6. Homeland security costs – Ports, chemical plants and other infrastructures need protection.
  7. Real estate/mortgage losses – $50 trillion in global wealth has been lost as a result of home price declines.
  8. Peak oil – Oil will become increasingly expensive to extract, and other energy sources will require heavy investment to develop.
  9. Increases in fossil fuel tax – As countries like China grow and consume, demand will raise the price of everything including taxes.
  10. Foreign trade deficits – Foreigners buy 70% of US debt to convert to equity.
  11. Pensions underfunded – Tax payers will have to bail out pensions that are underfunded through the Pension Benefits Guarantee Corporation, which is also underfunded.
  12. Local government pensions – Another $2 trillion hole that needs funding.
  13. Weak US dollar – The dollar will continue to decline as we print more money.
  14. US savings rates – The savings rate for Americans dropped to 0 last year.
  15. Consumer debt – Credit card and personal loan debts are climbing, and more and more people are declaring bankruptcy.
  16. Fannie & Freddie – Together they own $5 trillion in toxic mortgages, and the government has just invested.
  17. Drug use – Demand for illegal drugs are rising in the US.
  18. Non-transparent banking – The Fed is loaning out money, and nobody knows how much or where it’s going exactly.
  19. Lobbyists – They will continue fighting for their causes instead of what’s needed, and they control Washington.
  20. Class system – The gap between upper and lower income groups is rising.
  21. International credibility – Our loss of credibility with our nations will affect everything, including trade.
  22. Resources, education, unemployment, technology – All areas the US needs major reform on.

It’s a tough situation to overcome for the entire country, and President Obama has increased his spending significantly in order to confront these problems head on. What do you think about the future of the United States? Is your savings account big enough to handle an increase in everything that is taxable?

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