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Congratulations America, you are now 14 trillion dollars in debt. The U.S. national debt is now more than 14 times larger than it was just 30 short years ago. The federal government is literally drowning in debt. Now some members of Congress are actually debating whether we should raise the debt ceiling again. At the moment, the U.S. government debt ceiling is is set at $14.294 trillion, and considering the fact that the U.S. government is borrowing approximately 2.63 million more dollars every single minute, that cap will be reached very quickly. The U.S. Congress has raised the federal debt ceiling six times in just the past three years, so you would think that raising it again would not be that big of a deal for our debt-addicted politicians. But this past November a significant number of Tea Party candidates were elected to the U.S. House of Representatives, and they are eager to prove that they are serious about fiscal responsibility.

So exactly what is the debt ceiling? Well, it is an arbitrary limit on U.S. government debt that is set by the U.S. Congress. The original idea of the debt ceiling was that it would keep U.S. government debt from getting out of control, but obviously that has not happened. Whenever we have started getting close to the debt ceiling Congress has always raised it. It has been raised ten different times since 2001. Now it is time to raise it again, and if it does not get raised the U.S. government could actually start defaulting on its obligations.

So exactly how would such a scenario play out? Well, according to former Congressional Budget Office Director Rudolph Penner, financial disaster would ensue….

“Our bond market and stock market would crash.”

Austan Goolsbee, the chairman of Barack Obama’s Council of Economic Advisers, made comments during a recent appearance on ABC’s This Week that were even more ominous….

“This is not — this is not a game. You know, the debt ceiling is not — is not something to toy with. If we hit the debt ceiling, that’s the — essentially defaulting on our obligations, which is totally unprecedented in American history. The impact on the economy would be catastrophic. I mean, that would be a worse financial economic crisis than anything we saw in 2008.”

So would the financial system really crash if the debt ceiling is reached?

Well, it would certainly spook world financial markets. Whether a full-blown financial panic would erupt would depend on a lot of things.

But the truth is that U.S. government finances are going to crash whether we raise the debt ceiling or not.

The U.S. government is in the terminal phase of a debt spiral. Just look at the chart below. Is there a single person reading this article that actually believes that this debt is sustainable?

What would happen if your own personal household debt looked like that?

Right now, the U.S. government is in a debt trap. If it stops all of this borrowing the party will be over and our economy will plunge into a depression. But if it continues to borrow at this pace it is going to keep making the eventual collapse even worse.

There are a few Tea Party politicians that want to face the day of reckoning right now and attempt to start living within our means, but most of them don’t even realize how horrific that would be for the U.S. economy. Right now, out of control government spending is one of the only things stabilizing our economy. If U.S. government spending was slashed to a level where we would not have a budget deficit it would absolutely devastate consumer spending.

So is continuing to borrow massive amounts of money the answer? Of course not. But most of our politicians seem to want to keep “kicking the can down the road” and so that is what is probably going to happen for a while.

Eventually the rest of the world is going to get sick and tired of lending us money and interest rates are going to start spiking like crazy. At that point either the U.S. government will go bankrupt or the Federal Reserve will just start printing trillions of dollars out of thin air to keep the system running. Either option will be absolutely disastrous.

Not that we aren’t already in serious economic trouble. Even with the unprecedented government budget deficits of the past few years, the U.S. economy just continues to get worse….

*There were more U.S. consumer bankruptcies in 2010 than there were in 2009.

*There were more bank failures in 2010 than there were in 2009.

*Foreclosures were higher in the third quarter of 2010 (the last quarter we have numbers for) than they were in the third quarter of 2009.

*According to the U.S. Labor Department, the unemployment rate went up in two-thirds of America’s largest metropolitan areas in November.

So what would happen to the economy if the debt ceiling did not get raised and the U.S. government stopped pumping gigantic piles of cash into our economic system?

It would not be pretty.

But how in the world can we live with what we are doing to future generations? We are literally robbing them blind just to feed our endless debt addiction.

We have stolen so much money from our children and grandchildren that it is almost unimaginable.

For example, if the federal government stopped all borrowing today and began right at this moment to repay the U.S. national debt at a rate of one dollar per second, it would take over 440,000 years to pay off the U.S. national debt.

Instead of showing financial restraint, each new Congress just seems to push the debt pedal even closer to the floor. Sadly, the 111th Congress added more to the U.S. national debt than the first 100 U.S. Congresses combined.

So where is all of this going to end?

In financial disaster of course.

There is no avoiding it at this point.

About the only thing we can do to avoid financial disaster for a while is just to keep borrowing even more money.

Eventually it will all catch up with us, and when it does it is going to be a financial nightmare unprecedented in U.S. history.

To get an idea of what we are headed for, please take a few minutes to watch the short YouTube video posted below. It is entitled “The Madness Of A Lost Society 2: Final Warnings” and it does a good job of explaining how the path we are currently on is likely to end in a hyperinflationary collapse of the U.S. dollar….