The official national debt is currently racing toward $17 trillion, and the Congressional Budget Office is projecting another $10 trillion over the next decade, but monetary and currency expert Andrew Gause warns the real amount of red ink will be much worse.
Gause, author of "The Secret World of Money" and "Uncle Sam Cooks the Books," said the Congressional Budget Office is often conservative in its debt projections and that could mean a whole lot more than $10 trillion over the next decade.
"They've been way low and, unfortunately, it's the CBO that tell us that by 2023 the national debt will be around $26 trillion," Gause told WND. "If that is one of their historically conservative projections, that number can be off by as much as 50 percent. We could really be up in the mid-30s to $40 trillion in debt by 2023."
In addition to the mounting debt, Gause is very worried about the impact of inflation caused by the Federal Reserve's frequent injection of new money into the economy. He said there are three factors that trigger high inflation, and we're seeing all of them in effect right now.
First is an increase in the money supply, and Gause noted that the Federal Reserve has quadrupled the money supply over the past four years. He said there also must be an uptick in demand, with factories getting back to full capacity and employment picking up again.
The final factor is what he calls "monetary velocity," when people start spending money again.
"Those three (factors) could combine to provide the biggest bout of inflation we've ever seen in this nation, let alone comparing it to that last run from '77-'80," Gause said.
Gause said he finds himself "somewhere in between" liberals who insist they've cut spending as much as possible and deficit hawks who say our debt plus unfunded liabilities has us so far in debt that any recovery is hopeless. He said two budgeting tactics give him the most heartburn.
"The only bills that they have to reveal to us are those that are due in the next couple years. Anything that's due in outlying years doesn't exist, according to the government's budget," said Gause, who also finds it appalling that revenues received from Social Security taxes are thrown into the general budget and spent on anything and everything.
So what is his solution? Gause believes a lot of progress could be made simply by following through on Ron Paul's persistent goal of auditing the Federal Reserve, if the data revealed in conjunction with the Toxic Asset Relief Program, or TARP, is any guide.
"The data dump that the Fed revealed as a condition of this bailout revealed quite a bit in terms of insider dealing. The loans to the Bank of Libya. We were told they were a state enemy. We were not supposed to be trading with them, but yet we have our Federal Reserve Bank making them loans," Gause said. "Then the insider loans to the members and their wives, the owners of the banks and their wives. All of this was revealed in that data dump that the Fed made in response to the TARP bailout law. I think an audit of the Fed would reveal the inconsistencies and the self-dealing that goes on, and the bankers are making billions of dollars in profits from their ownership of the Federal Reserve system."