Breakup of the Union

The Breakup of the Union

 

One of the most interesting events of the next four years will be the attempt by Texas to secede from the Union once the US Government defaults on its debt or continues to spend without limits as indicated by the US Congressional House of Representatives agreeing to the unlimited debt ceiling demand by the BHO White House. When this passes, the economy of the US will be completely wrecked. The stock market will drop between 500 - 1000 points in a single day, Moody's and S&P will downgrade the US debt to either A or AA at best. Once the debt downgrade occurs, the interest rates will be forced to rise and remember:

 

For each 1% rise in the federal debt interest rate, on average, taxpayers will have to pay $160 Billion!

 

This means that if interest rates where to rise back to a normal 4-5% the US taxpayer will have to pay between $0.6 to 0.8 Trillion USD in just interest rate payments. This will ultimately force the US Government to default or print money to comply. It is simply a matter of macro-economics and finance. Nothing to do with US uniqueness -- the Chinese with their much more disciplined approach to economics and finance are doing to the US what we did to the world after WWII.

 

What goes around, comes around, eh? Texas and other profitable states will find staying in the Union more and more egregious as they are called upon to pay for their cousins' follies. Man! If this is not like the novel by Ayn Rand, "Atlas Shrugged," I don't what is. Texas in this case is in the same position as the novel state of Colorado. The breakup of the Union is coming or at least a major dissatisfaction.