Is the US headed for bankruptcy?

US federal government debt is out of control - even by the government's own forecasts. Bud Conrad of Casey Reserach asks: who is responsible for this profligate spending? And what will it mean for the dollar - and for your investments?

Recently I had the pleasure of having lunch with the Comptroller General of the United States, David M. Walker. He heads up the US Government Accountability Office (GAO), the government's internal watchdog. As he was about to give a talk on out-of-control government deficits, he had in his briefcase a chart on the size of the US government's obligations over time. Our discussion about those obligations over lunch was followed by an email exchange, and Walker kindly helped me source additional GAO data, all of which allowed me to confirm my analysis of the budget with projections from the Congressional Budget Office (CBO).

I have also met with Douglas Holtz-Eakin, head of CBO, who can competently recite the situation of six different budget projections without notes. The combined scenarios of the GAO and CBO provided me with the basis to create the following projection of the US budget as shown in the chart below:

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