The USA as a business: say it with pictures

Kudos to Ms. Mary Meeker and her firm, Kleiner Perkins Caufield & Byers. They have done a public service by putting together a comprehensive analysis, USA Inc., that tries to answer the question, "What if we looked at our country as a business and applied some related analytics & disciplines?"  I only wish it had gotten more visibility.

Some of the analysis is compelling, and stunningly, much of this basic data is simply not surfacing from the imbecilic cacophony of mugwumps in media, policy or politics. We can understand why the politicians don't want these pictures to see the light of day. Broad understanding would reveal the great unpleasantness and failure of political leadership that brought us here. They communicate quite clearly what our problems are.

Entitlements alone consume nearly all revenue, and it will get dramatically worse going forward:

Our balance sheet is fraudulent in that it does not disclose all liabilities. When we put those liabilities on the balance sheet we become book insolvent. So the next time a politician says the words "trust fund" make sure that he means that an independent, non-governmental third party trustee will hold the funds for your benefit.

And our debt outstanding only reflects what's the on balance sheet!  Through the wisdom of governmental accounting orange stuff above isn't reported as a real obligation on the balance sheet! In the private sector this omission would be garden variety 10(b)(5) fraud but as Marilyn Monroe once said, "It's different for girls..." so when you start thinking about the debt crisis, don't forget to put the orange stuff on the balance sheet.  The omission is a fraud: a game of 'Hide the ball' that government has played so long. Game over.

 Lastly, while we're spending a lot on defense it does not appear to be out of line historically.

Spend some time with the study & share it with fellow citizens. I'm not buying into all the recommendations as some obvious private sector solutions have been given short shrift (more on that later), but defining the problem is a first step to solving anything.

For context of the magnitude of this problem consider that: 

Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co., eliminated government-related debt from his flagship fund last month as the U.S. projected record budget deficits

And folks, that's the home team voting with their feet.

Update on Tuesday, July 19, 2011 at 10:31AM by hb

We're flattered to see WWB's Commentary leading the way for the WSJ, and note the date of their article today: America's Debt-Ceiling Opportunity by Emil Henry.