He actually predicted our current financial predicament over a year ago. And, he was the ONLY one who had the guts to discuss what the true solutions are, which Schiff echoes in this interview: 

• Dramatically reduce the size of government
• Abolish many government agencies and programs
• Dramatically cut entitlement spending
• Allow the free market to self adjust so that it can function properly 

President-elect Obama unfortunately does not have any plans toward this end. Instead, his economic plans call for: 

• Larger government
• More government programs designed to encourage more borrowing and consumption
• Raised taxes on the businesses that provide much-needed jobs for Americans 

As Schiff puts it: “Obamanomics” is a big disaster.  

When Will American’s Realize That Frugality is Not a Dirty Word? 

I also agree with one of my readers who commented: 

“The ability to plan ahead, frugality, self-awareness, and self-control are all characteristics that keep us healthy.  They are also the characteristics that keep us off the poor farm.  We Americans are dramatically failing at both.

Policies promoting perpetual growth are as unrealistic for the economy as they are for the human organism and, for that matter, the natural world.  Obesity and indebtedness are two sides of the same coin.”  

Indeed. For a long time, the American economy has been solely based on consumption. Borrowing money to buy more stuff has been the one thing that has kept this country going, and virtually all “remedies” are still aimed at keeping that American mentality going.  

But it can’t. 

Sooner or later the natural order of things must be reestablished. You can’t keep spending more than you earn indefinitely. And as a country, this mentality is the driving force behind the absolute destruction of the U.S. currency.

As Schiff points out:  

“Getting Americans to borrow and spend again – that’s the disease, not the cure.” 

And: 

“[They] worry about people going to the bank and not having any money there. I’m worried about people going to the bank, taking out money, and not being able to buy anything with it!” 

All of the current bailouts and stimulus packages are only making our problems worse. 

On a positive note, if there is one, the economy will likely be so poor at the end of Obama’s first term that American’s will finally elect someone who’s willing to act appropriately, and bring the reforms we need to survive and thrive as a country.

Got a Problem? Spend More Money – It’ll Go Away

The mindset of our current and upcoming leaders remind me of the U.S. health care system, where expensive drugs are thrown willy-nilly at symptoms; the treatments and “cures” causing more harm to the patient in the long run while making the pharmaceutical companies rich beyond anyone’s wildest dreams.

Just like the seven-year long “War on Terror” has shown, you cannot eradicate “terror” by throwing money at it. And the U.S. health care spending -- which topped out at $2.3 trillion in 2007 – clearly shows you cannot cure disease by throwing money at it willy-nilly either. Likewise, our current economic crisis simply cannot be solved by printing more money to throw into the pot. 

It’s the same principle at work in all three areas; within the conventional health care paradigm, within the interventionist foreign relations agenda, and in the frantic grasping for straws during this economic crisis: Take a pill; send out more troops; make more money available for people to spend.

These “cures” are destined to kill the patient in question, despite all promises that these remedies will “help you.”

Even the Most Abundant Well Will Eventually Run Dry

The truth is, the well of fictional wealth is drying up. America has, under the solid misguidance of the Bush administration, managed a near impossible feat: increasing the national debt by 45 percent since 2001, to a sobering $9 trillion.

And when I suggest that a gluttonous “too much, too fast” attitude has been busy at work, I’m basing it in part on this fact: from the moment of the U.S. constitutional birth in 1789, the debt accumulated by the federal government did not hit $1 trillion until 1981.

It took 183 years to incur the first trillion dollars.

It only took 20 years to grow that debt to $5.7 trillion, and a mere seven years to reach $9 trillion. .

How on earth will increased government spending, more corporate bailouts, and stimulus packages aimed at getting American’s to open up their pocketbooks like we used to, actually make matters better?

They won’t.