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IMF Says US Must Raise All Taxes, Cut All Entitlements By 35% To Contain Future Budget

Posted By admin On April 4, 2011 @ 9:12 am In Money Watch | Comments Disabled

Tyler Durden
Zero Hedge [1]
April 4, 2011

In what is either a delayed April Fool’s report, or its latest exercise in rhetoric the IMF asks the humorous question: “An Analysis of U.S. Fiscal and Generational Imbalances: Who Will Pay and How?” The obvious answer is naturally the Fed. The unobvious answer, according to the IMF, is the impossible: a slashing all of USSA’s entitlement benefits by a whopping 35% combined with a hike in all tax rates. From the IMF: “This paper updates existing measures of the U.S. fiscal gap to include federal laws up to and including the mid-December 2010 federal fiscal stimulus. It then applies the methodology of generational accounting to establish how the burden of adjustment required to attain fiscal sustainability is shared across generations.

We find that the U.S. fiscal and generational imbalances are large under plausible parametric assumptions, and, while not much affected by the financial crisis, they have not improved much by the passing of the Final Healthcare Legislation. We find that, under our baseline scenario, a full elimination of the fiscal and generational imbalances would require all taxes to go up and all transfers to be cut immediately and permanently by 35 percent. A delay in the adjustment makes it more costly.” Such drama: have these people really not heard of the Fed. What is rather shocking is that Larry Kotlikoff [2], who has made it all too clear the US is bankrupt, was used as a consultant: “We are extremely grateful to Lawrence Kotlikoff who acted as a consultant providing unique inspiration, guidance and supervision.” Are massively dissenting voices now credible sources of information? What next: Fed white paper citing Zero Hedge?

Full April Fool’s joke:

IMF Working Paper US [3]

Stock up with Fresh Food that lasts with eFoodsDirect (AD) [4]

IMF Says US Must Raise All Taxes, Cut All Entitlements By 35% To Contain Future Budget  260310banner2 [5]

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URLs in this post:

[1] Zero Hedge: http://www.zerohedge.com/article/imf-says-us-must-raise-all-taxes-cut-all-entitlements-35-contain-future-budget

[2] Larry Kotlikoff: http://www.zerohedge.com/article/boston-universitys-kotlikoff-explains-why-us-bankrupt

[3] IMF Working Paper US: http://www.scribd.com/doc/52245782/IMF-Working-Paper-US

[4] Stock up with Fresh Food that lasts with eFoodsDirect (AD): http://www.efoodsdirect.com/

[5] Image: http://purewaterfreedom.com/

[6] The Budget Battle: Entitlements Staying, Taxes Going Up: http://www.prisonplanet.com/the-budget-battle-entitlements-staying-taxes-going-up.html

[7] “Fixing” the Economy New York Times Style: Raise Taxes and Raise Taxes Even More: http://www.prisonplanet.com/fixing-the-economy-new-york-times-style-raise-taxes-and-raise-taxes-even-more.html

[8] Let’s Raise Taxes, Greenspan Tells CFR: http://www.prisonplanet.com/lets-raise-taxes-greenspan-tells-cfr.html

[9] Libertarian Plan Balances the Federal Budget by 2020 Without Raising Taxes: http://www.prisonplanet.com/libertarian-plan-balances-the-federal-budget-by-2020-without-raising-taxes.html

[10] U.S. Is Bankrupt and We Don’t Even Know It: Laurence Kotlikoff: http://www.prisonplanet.com/u-s-is-bankrupt-and-we-dont-even-know-it-laurence-kotlikoff.html

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