Exhibit Two: Growth of US Federal Obligations vs. GDP

Interestingly, the trend of US government financial obligations parallels the growth of ecological overshoot – particularly since the year 2000 when overshoot became more evident in terms of climate change, ecosystem damage and commodity shortages.

In the following chart we see the growth of total US government obligations relative to GDP. Total obligations include implicit debt (unfunded liabilities to Social Security, Medicare and Federal pensions) plus the normally reported explicit debt. Using generally accepted accounting principles (GAAP), federal obligations at fiscal yearend 2012 were $85.6 trillion – roughly 5.5 times nominal GDP.

This ratio has risen sharply as federal outlays drained public retirement trust funds in order to finance counter-cyclical spending and current consumption. Together with the costs of ecological overshoot, the result has been an increasing drag on GDP.

ex2

Broadly speaking, this debt/ratio reflects an inability to adjust our lifestyles to the ecological resources on which we depend – a defining attribute of the Anthropocene.

As the ratio rises, we have redoubled our efforts to restore business as usual, which further destabilizes the biosphere and GDP. The result is increasing economic chaos and inflation.

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