What Is Wrong With The U.S. Economy? Here Are 10 Economic Charts That Will Blow Your Mind

The 10 economic charts that you are about to see are completely and totally shocking.  If you know anyone that still does not believe that the United States is in the midst of a long-term economic decline, just show them these charts.  Sometimes you can quote economic statistics to people until you are blue in the face and it won’t do any good, but when those same people see charts and pictures suddenly it all sinks in.  What is great about charts is that you can very easily demonstrate what has been happening to the economy over an extended period of time.  As you examine the economic charts below, pay special attention to what has been happening to the U.S. economy over the last 30 or 40 years.  The truth is that what is wrong with the U.S. economy is not a great mystery.  All of the economic problems that we are experiencing now have taken decades to develop.  Hopefully the charts in this article will help people realize just how nightmarish our economic problems have become, because until people start realizing how incredibly bad things have gotten they will never be willing to accept the dramatic solutions that are necessary to fix our financial system.

The sad fact of the matter is that we have been living in the biggest debt bubble in the history of the world over the last 40 years.  All of this debt has purchased a wonderful standard of living for the vast majority of us, but all of this debt has also destroyed the economic future of our children and our grandchildren.  Someday future generations will look back on what we have done in absolute horror.

The 10 economic charts posted below are meant to shock you.  Most Americans today need to be shocked before they will be motivated to take action.  Please share these charts with as many people as you can.  Hopefully we can wake enough people up that something will be done about all of these problems while there is still time.

1 – Government spending is expanding at an exponential rate.  As you can see from the chart below, federal spending is almost 18 times higher than it was back in 1970.  Now Barack Obama has proposed a budget that would increase U.S. government spending to 5.6 trillion dollars in 2021.  Just imagine what the following chart would look like if that happens….

2 – U.S. government debt is absolutely exploding.  The U.S. national debt is currently $14,081,561,324,681.83.  It is more than 14 times larger than it was back in 1980.  Unfortunately, the national debt continues to grow at breathtaking speed.  In fact, the Obama administration is projecting that the federal budget deficit for this year will be an all-time record 1.6 trillion dollars.  Can we afford to continue to accumulate debt at this rate?….

3 – Unless something changes right now, the outlook for U.S. government finances in future years is downright apocalyptic.  The chart posted below is from an official U.S. government report to Congress.  As you can see, it is projected that interest on our exploding national debt is absolutely going to spiral out of control if we continue on the path that we are currently on….

4 – Household debt has soared to almost unbelievable levels over the last 30 years.  The sad truth is that it is not just the U.S. government that has a massive debt problem.  U.S. households have also been accumulating debt at a staggering rate.  Total U.S. household debt did not pass the 2 trillion dollar mark until the mid-1980s, but now total U.S. household debt is well over 13 trillion dollars….

5 – The total of all debt (government, business and consumer) in the United States is now well over 50 trillion dollars.  For the past couple of years this figure has been hovering around a level that is equivalent to approximately 360 percent of GDP.  This is a debt bubble that is absolutely unprecedented in U.S. history….

6 – As tens of thousands of U.S. factories get shut down and as millions of our jobs get shipped overseas, the number of unemployed Americans continues to go up and up and up.  As you can see from the chart below, there has been a long-term trend of increasing unemployment in the United States.  In fact, there are about 3 and a half times as many unemployed workers in the United States today as there were when 1970 began.  These jobs losses are going to continue as long as we allow our corporations to pay slave labor wages to workers on the other side of the globe.  All of the major trends in global trade are very bad for the U.S. middle class.  For example, the U.S. trade deficit with China for 2010 was 27 times larger than it was back in 1990.  How long will our politicians stand by as our nation bleeds jobs?….

7 – The median duration of unemployment in the United States is in unprecedented territory.  For most of the post-World War 2 era, when the median duration of unemployment in America reached 10 weeks that was considered a national crisis.  Well, today competition for jobs is so intense that the median duration of unemployment is now well over 20 weeks….

8 – Since the Federal Reserve was created in 1913, the value of the U.S. dollar has declined by over 95 percent.  One of the reasons given for the existence of the Federal Reserve is that the Fed helps control inflation.  But that is a huge lie.  The truth is that the United States never had consistently rampant inflation until the Federal Reserve took control.  In particular, once the U.S. totally went off the gold standard in the 1970s inflation really started escalating out of control….

9 – Now the Federal Reserve says that the solution to our current economic problems is to print even more money out of thin air.  The games that the Federal Reserve is playing with our money supply are simply inexcusable.  Just look at what the Federal Reserve has done to the monetary base since the beginning of the recession….

10 – All of this new money is creating tremendous inflation.  In particular, the price of oil is now ridiculously high.  A high price for oil is very, very bad for the U.S. economy.  Our entire economic system is based on being able to use massive quantities of very cheap oil.  Unfortunately, that paradigm is starting to break down and the consequences will be very bitter.  Back in mid-2008, the price of oil hit an all-time record of $147 a barrel and subsequently the world financial system imploded a few months later.  Well, the price of oil is on the march again and that is very bad news for the U.S. economy….

Needless to say, if the economic trends documented by the charts above continue the U.S. economy will be totally wiped out.  The U.S. economy as it currently exists is unsustainable by definition.  It is only a matter of time before we slam into an economic brick wall.

We have developed an economy that cannot function without debt, and at this point it seems like almost everyone is drowning in red ink.  The federal government is massively overextended, most of our state and local governments are massively overextended, most of our major corporations are massively overextended and the majority of U.S. consumers are massively overextended.

The only way that the game can continue is for the Federal Reserve to print increasingly larger amounts of paper money out of thin air and for everyone in the economic food chain to go into increasingly larger amounts of debt.

But no debt spiral can go on forever.  At some point this entire house of cards is going to collapse.

When that happens, there is going to be economic pain that is greater than anything that this country has ever seen before.

Someday we will all desperately wish that we could go back to the “good times” of 2011.  A great economic collapse is coming, and all of us had better get ready.

What To Do

Today, more Americans than ever are absolutely convinced that we are headed for an economic collapse.  After all, it doesn’t take an advanced degree in economics to understand that American consumers, American businesses, local governments, state governments and the U.S. federal government are all drowning in debt.  It would be hard enough to deal with all of this debt during good economic times, but these are not good economic times.  In fact, right now the U.S. economy is being pounded by an unprecedented number of economic problems.  Tens of millions of Americans are unemployed or underemployed, 40 million Americans are on food stamps, the U.S. real estate crash continues to get worse, and the ongoing oil spill in the Gulf of Mexico threatens to drag that entire region, and perhaps all of the United States, into a devastating economic depression.  So these days it is fairly easy to convince Americans that really hard economic times are coming.  But now an increasingly large number of people have a new question.  They want to know what to do about all of this.  In fact, probably the biggest group of questions I receive from readers is regarding what to do in order to prepare for the economic collapse that is coming.   People are tired of just talking about all of these problems and they want an action plan. 

So what is the answer?

What should people do about this coming economic collapse?

Well, when I attended law school I was taught that there is a two word answer to almost any question that someone can ask about the law….

It depends.

And while there are some fundamental principles which we should all follow in getting prepared for the coming economic crisis (which I will share below), the truth is that each and every person has very different circumstances that they are facing, so when someone asks what they should do I give them that same answer….

It depends.

If you have a family you are going to prepare much differently than if you are single.

If you live along the coast you are going to prepare much differently than if you live in the mountains or in the city.

If you are wealthy you are going to prepare much differently from someone who only possesses limited resources.

If you are dependent on a job you are going to prepare much differently from someone who is self-employed.

If you live on a farm you are going to prepare much differently from someone who lives in an apartment building and has never even grown a garden.

The truth is that there are a ton of variables and there just is not a “one size fits all” answer.

However, there are some fundamental principles that we should all be following as we prepare for the coming economic collapse….

Get Out Of Debt

It is always, always, always a good idea to get out of debt, but this is particularly true during a time of economic crisis.  During an economic collapse, it will be very difficult to get work, money will be tight, and the last thing you will want to be doing is to be making monthly payments on some debt that you accumulated five years ago.  The reality is that when we borrow money we become a servant, and debt is a very cruel master

You especially want to get rid of debt that is at high interest rates (such as credit card debt).  There are very few things that are as good at bleeding your finances as credit card debt is.  For example, according to the credit card repayment calculator, if you have a $6000 balance on a credit card with a 20 percent interest rate and only pay the minimum payment each time, it will take you 54 years to pay off that credit card.

During those 54 years you will pay $26,168 in interest rate charges on that credit card balance in addition to the $6000 in principal that you are required to pay back.  That is before any fees or penalties are even calculated.

Can you see how financially debilitating that can be?

The truth is that if you haven’t already started, now is the time to develop a plan for how to get out of debt.  Paying off debt can be very painful, but it will put you in a much, much better position to weather the financial storms that are ahead.

Reduce Your Expenses

Along the same lines, it is a very good idea to start reducing your expenses right now.  The truth is that you cannot be sure that you will always have the same job or the same level of income.  Times are going to be very tight in the future.  Now is the time to start the belt tightening.

Yes, the truth is that the cost of everything seems to be going up these days, and most American families are already finding it increasingly difficult to get by each month.

But if your household is spending $5000 a month right now, are there ways that you could get that down to $4000 or maybe even $3000? 

If we all start learning to live with less right now, it will be much easier to do when times really get hard.

Increase Your Income

Yes, this is much easier said than done.  Especially considering the fact that it seems like there are hardly any jobs out there right now.

But the truth is that we are all going to have to work a lot harder and become a lot less dependent on employers.

It is going to become increasingly difficult to get good jobs in the months and years ahead.  The big global corporations are figuring out that they really don’t need us after all.  In many ways, it is much easier for them to hire a workforce from the other side of the world.

So where does that leave us?

Well, fortunately there are still a lot of ways to make money in America.  How long that will last is uncertain, but for now we should work while the working is good.  We are all going to have to start becoming a lot more entrepreneurial.

Nobody is going to hand you anything in this life.  If you just settle for your job (“just over broke”) you aren’t going to get too far in today’s world.

Many people start developing an extra income during their spare time in the evenings after work.  Yes, that would mean that you would have less time to sit on the couch and watch people talk about who LeBron James is going to play basketball for, but did you think that we were going to be able to get through this without making sacrifices?

Now is the time to rise up off the sofa and figure out how to make some more money.  There is still a little more time to get prepared.  If you keep putting off what you know needs to be done, eventually it will be too late.

In addition, learning to do things like growing a garden is another way of “increasing” your income.  All of the fruit and vegetables that you grow will mean that you won’t have to spend as much at the grocery store.

Stock Up On Essentials

There are tons of supplies still in the stores, and prices are still relatively low right now (especially compared to what they will be in the future).  So it is time to stock up on essentials while the getting is good.

In a previous article entitled “20 Things You Will Need To Survive When The Economy Collapses And The Next Great Depression Begins”, we listed 20 of the things that you will need in the event of a major disaster, an emergency or an economic collapse.  These are the things that you are going to want to make sure that you have ready right now, because after the crisis begins it may be too late to prepare….

#1) Storable Food

#2) Clean Water

#3) Shelter

#4) Warm Clothing

#5) An Axe

#6) Lighters Or Matches

#7) Hiking Boots Or Comfortable Shoes

#8) A Flashlight And/Or Lantern

#9) A Radio

#10) Communication Equipment

#11) A Swiss Army Knife

#12) Personal Hygiene Items

#13) A First Aid Kit And Other Medical Supplies

#14) Extra Gasoline (But Be Very Careful How You Store It)

#15) A Sewing Kit

#16) Self-Defense Equipment

#17) A Compass

#18) A Hiking Backpack

#19) A Community

#20) A Backup Plan

In the comments to that article, our readers suggested the following additional items….

A K-Bar Fighting Knife


Extra Batteries


A Camp Stove


Pet Food

Heirloom Seeds


An LED Headlamp



Calcium Hypochlorite

Ziplock Bags

Maps Of Your Area


Sleeping Bags

Rifle For Hunting

Extra Socks


Gold And Silver Coins For Bartering

Of course there are probably many more items you could put on the list.

The point is to get educated, get informed and start getting prepared.

When things get really hard, that brand new pool table isn’t going to do you much good, but having a good supply of food and clean water will make all the difference.

Not that things are going to totally fall apart overnight.  It is going to be a process.

But you don’t start preparing when the storm is already on top of you. 

Most of us know what is coming.

Now we need to start taking action. 

This is how Americans got through the Great Depression of the 1930s – they tightened their belts, they were resourceful, and they did whatever they needed to do to provide for their families.

Now it is our turn.  Sure some people will laugh as many of us adjust our lifestyles in preparation for hard economic times, but it is those same people who will come knocking on your door when the rain does start pouring.