By The Numbers - The Fiscal Cliff That Is The National Debt and Why No Other Issue Matters

We have often warned that the skyrocketing Federal government national  debt is eventually going to crash our economy, our financial stability, and our democracy if the situation is not gotten under control and under control  quickly. Today’s post is going to review the statistics and dangers of the national debt and why the Washington politicians have to take some serious budget actions and reductions soon or the whole house of cards of our financial system and economic stability is going to go over the fiscal cliff.

Some Federal budget statistics in no particular order that should scare the hell out of you:

• If you had spent $1,000,000 a day from the day that Christ was born, you still would not have spent a trillion dollars.

• Spending a million dollars a day over the past two centuries or so would take you to about $750 billion.

• The Federal government national debt is currently about $36 trillion.

• Thus, the current national  debt is about 50 times larger than the amount of money you would have spent if you had spent $1,00,000 a day since Chrisst was born.

• There are about 154,000,000 Federal tax returns filed every year.

• Thus, on average each of those taxpayers would have to pay about $234,000 each to pay off the national debt.

• Given there are about 340 million Americans living in the country today, each man,  woman and child would have to pay out about $106,000 each to pay off the national  debt.

• A family of four then would have to pony up about $424,000 to pay off the  national  debt.

• If you think that “taxing the rich”  more would pay off the debt you are absurdly wrong.

• According to Forbes magazine, as of late 2024, Elon Musk was the richest American with an  estimated wealth of $244 billion.

• Even if you taxed his wealth at 100%, his $244 billion would pay off less than .7% of the national debt, not 7%, .7%.

• If you only took 10% of his wealth you would pay off only .07%.

• If you taxed the wealth of the ten wealthiest people in the country at 100% and applied it against the national debt you would pay off only about 4.3% of the debt.

• If you only took 10% of their wealth, you would pay off only .43% of the national debt.

• And finally, according to Forbes, the total wealth of the 400 wealthiest Americans comes out to about $5.4 trillion, which if you confiscated all of it and applied it to the  national debt, you would pay off less than 15% of the debt.

• Thus, taxing the rich more makes no sense since even if you took ALL of their wealth and applied it to paying down the debt, you would only pay off a very small portion of the $36 trillion on the books.

• Oh, and by the way, this $36 trillion doesn't include the over $80 trillion (source: Congressional  Budget Office) in unfunded government liabilities for  Social Security and Medicare’s budgets that are going to be needed over the next 75 years.

• To  meet those unfunded liabilities, the Federal government would need to collect, on  average, an additional $1.07 trillion a year for 75 years to keep Social Security and  Medicare solvent under the current assumptions and parameters of the programs.

• But in 2024 the Federal government only collected $4.92 trillion in tax revenue which means to cover the additional $1.07 trillion a year it would have to raise taxes by about 22%.

• However, of that $4.92  trillion collected, about $1.107 trillion of that was spent on defense and $1.124 trillion was spent SOLELY to pay the interest on the  national debt (Source: Wall Street Journal  article, February 22, 2025.)

• Thus, about 45% of the Federal  government’s revenue stream was spent on only two budget lines, interest payments on the debt and defense before any other government expense was considered..

• In theory, if the Washington political class had been operating on a balanced budget over time, then there would not be $1.124 trillion being paid out of taxpayer taxes every year to service the national  debt which means that on average, every one of the 154 million taxpayers would have an additional $7,300 in their bank accounts every year, $7,300 that wasn't going to fund interest payments on the ever escalating national debt..

• But the Biden administration spent $6.75 trillion in fiscal 2024, adding a whopping $1.83 trillion to the national debt.

• Thus, in fiscal 2024 the Federal  government under Biden  collected more in taxes than any government entity in the history of mankind and still  overspent it by 37%, indicating he and the rest of Congress never had an intention of getting  Federal spending under control.

• Given the over spending by $1.83 trillion and about 154 million taxpayers, on average each taxpayer would have saved about $11,800 in taxes if Washignton had just spent what it had collected in taxes.

• Since the national debt in 2024 was about $36 trillion and the GDP  of the entire country was about $29 trillion (GDP - value of all  goods and services produced in the  economy in a year), even if every dollar of the GDP was used to pay down the national debt we would still be looking at $7 trillion of debt.

• With the exception of the covid years, the debt to GDP ratio has never been higher, 1.24% in fiscal  2024.

• Going back to the Wall Street Journal article cited above, written by Niall Ferguson, he analyzed the historical relationship between defense spending and national debt/interest payments and concludes that once defense spending falls below debt servicing costs, like it did for the first time for this country in 2024, the decline of all great historic powers begins.

In the face of these  dire statistics and situation, Washington folks have been busy spending billions and billions of dollars on the following nonsense:

• $20 billion for a Sesame Street play in IRAQ.

• $4.5 million to “combat misinformation is Kazakhstan”

• $3.9 million for “LGBT  causes in the western BALKANS

• $6.0 million for tourism in EGYPT

• $2 million to fund sex change operations in GUATEMALA 

• Billions more for similarly inane and corrupt projects

If you are upset because Trump and Musk are shutting down government functions like these listed here but are ignoring the real threat to this country, the national debt and out of control Federal government spending, then you and I have different priorities. And while I respect your right to have a different view and different priorities, I am going to continue to construct my parachute because when the Federal government and the country shortly and  likely go over that fiscal cliff, I want to be ready and not go splat on the fiscal cliff canyon floor.

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If you agree that we need to deseat every member of Congress for their lack of success and accomplishment, then please consider going to the following petition link to help the cause:

https://www.change.org/p/deseat-congress-reset-freedom

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Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

https://www.amazon.com/Love-My-Country-Loathe-Government/dp/1604942789/ref=sr_1_1?dchild=1&keywords=love+my+country%2C+loathe+my+government&qid=1607716020&sr=8-1

Please visit the following sites for freedom:

http://www.reason.com

http://www.cato.org

http://www.openthebooks.com

http://www.conventionofstates.com

http://www.youtube.com/watch?v=08j0sYUOb5w

 

August, 2017, Part 3, Political Class Insanity: Insane In Canada, Obama's County Level Economic Failure, and Lies About the Rich and Taxation

It is the beginning of another month which means it is again time to review the latest political class insanity from Washington and around the world. Political class insanity takes many forms including the wasting of taxpayer wealth, criminal fraud within government programs, inane and stupid political quotes and actions, the inability to create and implement effective and efficient government programs, stupid and ill performing economic policies and strategies, and other forms of insanity that continue to evolve and surprise and shock us.

1) The other day we talked about how HUD and the Commerce Department of the Federal government were losing tons of taxpayer money via either outright fraud or incompetence. As readers of this blog know, these are not the only Washington bureaucracies that waste hundreds of billions of dollars every year. But apparently American politicians are not unique in their ability to waste taxpayer wealth.

Consider this atrocity of government spending up in Canada, courtesy of Josh Elliot of CTV News on July 19, 2017:

• In Tom Riley Park in Etobicoke, Ontario, Canada, there was a very steep dirt and rocky path into the park that led into a community garden within the park.
• Local resident and retired mechanic, Adi Astl, decided to do something about this treacherous situation since several of his neighbors had actually fallen down the steep undeveloped path.
• He and his neighbors collected $550 which he used to buy materials to build wooden stairs that allowed park visitors to safely descend the dangerous path into the garden area in the park. 
• Even better, he supervised and paid a homeless resident to build the steps. Everyone wins: safety is enhanced and a down on his luck homeless person receives some money for a job well done.
• Astl says that his neighbors thanked him, strangers visiting the park thanked him and members of the garden club who maintain the garden thanked him for his work.
• And that is where the happiness ends since the local political class decided they could have none of this good will towards men going on on their watch and they tore down the steps, recreating the original dangerous situation.
• The local politicians and bureaucrats claimed that the steps he built were not up to city regulations and had to be torn down and that it was their job to build the right kind of steps.
• Unfortunately, their estimated cost for the project was between $65,000 and $135,000 for a simple flight of steps.
• While the mayor agreed that the city estimate for the steps sounded “completely out of whack with reality,” he still stood by his decision to destroy a private citizen solution to a public safety problem: “We just can’t have people decide to go out to Home Depot and build a staircase in a park because that’s what they would like to have.”

A perfect example of how the political class and government works: inefficiently, corruptly, and ineffectively and it took a private citizen, thinking about the safety of his neighbors up in Canada, to show why taxpayers always get screwed as government gets larger and larger. $65,000 for a small set of stairs, no corruption, kickbacks, and favoritism going on here. Not. 

This is just another small example of how the U.S. is quickly approaching a national debt load of $20 TRILLION. Government jobs done poorly and expensively.

2) Obama liked to brag on how he single handedly saved the U.S. and world economy when he came into office. Of course, we have debunked that self promotion so many times:

• The economic recovery he claims to have led was by far the weakest economic recovery in at least 80 years.
• The jobs that were created during his Presidency tended to be low paying, menial jobs which accounted for stagnant household wages and earnings during his entire time office.
• The labor participation rate during his recovery was at the lowest levels since the economic disaster known as the Carter administration almost 50 years ago.
• He accomplished all of this trivial success by almost doubling the national debt from about $10 trillion to $20 trillion, weakening the economy for decades to come.
• All of his economic programs, e.g. Cash For Clunkers, Cash For Appliances, etc. were unadulterated failures.
• A record over 94 million American adults were out of the work force by the time he left office.

And now we can add another dismal aspect of his economic strategy and leadership skills. According to a recent article by the 538 website that was summarized in the August 4, 2017 issue of The Week magazine, “Just 20 counties were responsible for roughly half of the of new businesses created in the U.S. since the recession. That’s .64% of the 3,100 counties in the U.S.”

So 99.36% of the counties in the country accounting for half of the growth in new businesses in the country during the Obama reign while just .64% of the counties accounted for about the other half. Talk about skewed results, results that probably helped get Trump elected. When your party’s economic policies basically ignore over 99% of the country, there has to be negative election impacts which is exactly what happened. 

Makes you wonder how inept you have to be from an economic strategy perspective to incur such ridiculously skewed results.

3) Politicians, especially Democrats, always think that raising taxes will solve all of the country’s problems. They fail to acknowledge that their mismanagement of the government they are in charge of wastes untold hundreds of billions of dollars a year via inefficiencies, ineffectiveness, redundancies, and outright criminal fraud. 

If they were doing their jobs, there would likely be more than enough money and taxpayer wealth found to actually resolve some problems. Instead, their constant, stupid, and brainless response is to just raise taxes.

And when calling for more taxation, Democrats always like to play the blame game and blame the “rich” for not paying their fair share of taxes. This diverts the spotlight from what the real problem is, their inability to do their jobs without wasting taxpayer wealth, and try to shift the blame to the rich. 

This empty and incorrect rhetoric does nothing but divide Americans against each other, again diverting attention from politicians’ inabilities. We have stated too many times in this blog that no American, rich or poor, should pay another penny in taxes until the American political class finds out how to handle the hard earned tax wealth we turn over to them everyday. Until they do that, no more raising of taxes or dividing the country along economic lines and lies. 

Because, in reality, if you look at the numbers, the rich pay far more than their fair share in taxes, proving again the politicians, especially liberals and Democrats, lie to our faces. If you look at a recent article on the www.howmuch.net website, which did an analysis using research from the Tax Foundation, you will find that:

• The top 1% of earners in this country, the very rich, pay a whopping 39.5% of the Federal income taxes in this country; in other words they pay at a rate that is almost 40 times higher than their incidence in the general population.
• They pay well over half a TRILLION dollars a year in Federal income taxes.
• Those earners in the top 1-5% pay 20.5% of all Federal income taxes, or about five times their incidence in the general population.
• Thus, the top 5% earners in the country pay over 60% of all Federal income taxes.
• Contrast that to the bottom 50% of earners in this country that pay only 2.8% of Federal income taxes, “which is more than 14 times less than the top 1%, even though this group is 50 times as numerous.”
• For the richest 1%, the effective average tax rate is 27.2%, meaning that well over a quarter of their income goes into Federal income taxes.
• For the next group (up to 5%), the effective tax rate is still a high 23.6%.
• Taxpayers with incomes in the top 10% part with just over one-fifth (21.3%) of their earnings.
• Since 45% of American earners make too little to pay any Federal income tax, the effective tax rate for the bottom 50% of earners is just 3.5%, about one eighth the rate of the top 1%.

Thus, this kills another political class set of lies who like to claim that rich people do not pay a high enough percentage in taxes since they get special tax treatment. The above realities and numbers also prove this claim to be a lie.

Again, no American, especially the rich, should pay another penny in taxes until the political class finds a way to get smart and stop wasting all that tax revenue. And as the above numbers prove again, politicians lie on all matters, including tax matters, do not believe their insane claims when it comes to fairness and reality in the realm of taxation. More insanity to follow.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w

When The National Debt Bubble Bursts Nothing Else Matters, Part 1

Americans are worried and upset about a lot of issues these days. Politicians, lousy job opportunities, stagnant household income growth, who is allowed in what bathrooms, terrorism, high taxes, bad schools, crumbling infrastructure, etc. But all of these issues, while seemingly important, are trivial vs. the only big issue that matters: a Federal government (and many local and state governments) that is hurtling towards fiscal disaster and insolvency. 

If and when the fiscal integrity of the United States crumbles, and that possibility grows larger and larger every day, no one is going to care what the local bathroom policy is, why little Johnny is not getting educated, etc. because it will be a matter of basic survival in a collapsed economy that is the only concern.

Given that the Obama administration and legacy has almost doubled the national Federal debt from about $10 TRILLION to almost $20 TRILLION, this is the current Federal debt burden in the United States:

• Debt per household - just under $159,000
• Debt per every man, woman and child - abut $62,500
• In other words to wipe out just the Federal government debt, every household, on average, would have to write a check for about $159,000. 
• Every person, including kids and infants, would have to pony up about $62,500 to wipe out just the Federal government debt. 
• A family of four would have to write a check for about a quarter of a million dollars.

Given that we have previously written on studies that show over 40% of American households would have a hardship paying off an unexpected household expense of $400, it is obvious that American households and individuals cannot pay out $159,000 or $62,500 to help bail out the incredibly deep spending hole that Washington has dug.

Now, some liberal readers I know are thinking, tax the rich, let them pay off the debt. Let me give one example why that is such an ignorant thing to say. Bill Gates has a net worth of $86.4 billion as of February 24, 2017 according to Forbes. 

For this example, rather than just raise Mr. Gates taxes on his annual income, let’s confiscate everything he owns, liquidate his assets, and apply that $86.4 billion to the national debt. In this case, his entire fortune would pay off .4% of the current national debt. Not 4%, only .4%. Since we are not going to confiscate his entire fortune, just having a higher tax on his income, in reality not even this paltry .4% would ever be attained by "taxing the rich."

Let’s take this theoretical example one step further. Since the government spends about $10.4 billion a DAY, Bill Gates entire fortune would operate the Federal government for a little over eight days, just over a week, never mind paying off a $20 TRILLION national debt.

Hopefully these examples, numbers and realities give you an idea of how bad the debt and fiscal situation is in this country. But if you want to be scared even more, consider some debt realities in an article written by Peter Suderman in the April, 2017 issue of Reason magazine (and some simple population and household calculations we added):

• Within 10 years, on the current spending and budget path of the Federal government, the Federal government debt will increase by about 64%.
• Last year the interest on the debt was $241 billion or about $1,900 for every U.S. household.
• This is $1,900 that cannot be spent on a new car, vacations, movie tickets, dinner out, and other healthy economic activities to help grow the economy.
• This is $1,900 that cannot be spent on better schools, fixing crumbling infrastructure, or helping the less fortunate. 
• Interest payments on the debt, under Federal government current spending paths, will grow 196% in the next ten years, the fastest growing component of the Federal budget.
• This growth translates to an annual interest payments of $712 billion a year in ten years, up from $241 billion in 2016. 
• This $712 billion translates to a debt burden of about $5,600 a year per household.
• And this assumes that interest rates do not jump higher than expected since every percentage point above the current government projections would add another $1.5 TRILLION in debt.

A number of things to take away from all of these numbers:

• The Federal government debt hole is gigantic and getting deeper every day by the out of control spending by the Washington political class.
• Taxes diverted to pay for debt is wealth that cannot be spent by those that earned it or by government to fix what needs to be fixed in this country, it is a dead weight expense.
• You cannot come close to paying off this debt by increasing everyone’s taxes since that amount of wealth that would need to be taxed to pay off the debt simply does not exist.
• You cannot come close to paying for this debt by taxing the rich, only significant drops in government spending can help tame the debt burden.
• And the situation could get worse if interest rates go higher than expected.

One more debt fact to scare you. A recent Businessweek blurb announced that the entire net worth of every company, in the the S&P 500 stock index, if added together would be just over $20 TRILLION. In other words, the Federal government national debt is now roughly equivalent to the TOTAL worth of the 500 companies listed in the index. If this does not say government is out of control, nothing does.

So as the political class divides us up and pits citizen against citizen on a whole slew of issues, they continue to spend like there is no debt crisis at all. But when the debt bubble bursts, when your savings and assets crash, when your Social Security and Medicare benefits are slashed or evaporate, and possibly the need to survive and eat is a day to day struggle (see current day Venezuela), who uses what bathroom, why is Johnny not getting educated and other issues will become unimportant and trivial. 

This whole mess reminds me of an old Peanuts Sunday comic from long ago. Snoopy goes out for a jog on a very cold morning and before you know it every part of his body is complaining. His knees hurt and complain, his feet hurt and complain, his ears are getting frost bite and complain, his stomach is hungry and complains when his brain questions why they are out jogging on a cold day when all of the body parts are complaining and do not want to be out. 

At which part the heart speaks up and says the reason they are out jogging on a cold morning is to keep the heart healthy because if the heart goes, everything else is secondary. When the ever inflating debt bursts, everything else is secondary.

Tomorrow, to add to the horror, we will discuss bad situation at the local and state government level.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:


http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w

May, 2015, Part 1, Why No American Should Pay Another Penny In Taxes

Hundreds of times we have shown in this blog how the Federal government and the Washington political class have wasted untold trillions of dollars of taxpayer wealth over the years. This has left the taxpayers nothing in return to show for their money except a whopping $18 TRILLION national debt. Many times the money was spent on one time, wasteful projects:

• The Navy built two new ships almost to completion at a cost of $300 million only to spend another $10 million to junk them immediately.
• Hillary Clinton’s State Department spent $40 million to build a U.S. consulate in the hinterlands of Afghanistan only to find out after spending the money that it had to be abandoned because it could not withstand a terrorist attack.
• The TSA purchased hundreds of millions of dollars of equipment for airport security in order to get a bigger discount but ended up not using a high percentage of the equipment anyway, leaving it stacked in a warehouse never to be seen or used.
• The National Science Foundation has spent millions and millions of dollars on such inane projects as building a video game to simulate prom week, studying when dog became man’s best friend, determining if dating sites were racist and other equally useless projects.

But many of these one time wastes of money pale in comparison to the money that is consistently wasted in the same manner year in and year out:

• Medicare and Medicaid lose upwards of $100 billion every year due to inefficiencies and outright criminal fraud.
• Social Security loses upwards of $100 billion every year due to inefficiencies and outright criminal fraud.
• Other welfare programs such as Federal housing support and food assistance lose billions and billions of dollars every year due to inefficiencies and outright criminal fraud.
• The IRS loses billions of dollars every year to identity theft in the income tax filing system every year.
• The IRS is so inept that it openly admits that it fails to collect almost $400 billion a year from tax evaders.
• The President’s debt reduction commission easily identified $100 billion a year that could be removed from the Pentagon’s annual budget without endangering national security.

Thus, it is pretty obvious that no American, no matter how rich or poor, should pay a penny more in taxes, given that the Federal government and the Washington politicians that operate it easily waste or fail to collect a whopping $800 billion or so EVERY YEAR.

But this reality is apparently lost on a Georgia Congressman. 

Congressman Hank Johnson recently stated that when it comes to taxes, “we [Washington politicians] don’t have enough [taxes] to do what the government - and do what the country needs the government to do and that’s the problem.”

The Congressman went on: “If everyone is paying their fair share of taxes than we certainly should and can live within our means. But our problem now is that taxes are being paid by the middle class. The rich, the wealthy and the corporations are not paying their fair share and so therefore we don’t have enough to do what the government and do what the country needs the government to do and that’s the problem.”

Note: before you consider whether the Congressman’s position has any merit, remember that this is the same Congressman who claimed in public:

• That the island of Guam might tip over in the middle of the ocean if too many U.S.military resources were placed on the island. That’s right, he actually stated in a Congressional committee meeting that an island could tip over.
• He also lamented the possibility that there would not be enough helium gas to blow up birthday balloons if Congress stopped funding a Federal storage facility for helium.

Okay, back to the issue at hand.

There it is again, the rich do not pay enough. But is that true, in light of how much money and taxpayer wealth people like Congressman Johnson waste every day:

• CNS News reported in 2014 that taxpayers earning over $100,000 a year pay 71.6% of all Federal income taxes every year.
• The Tax Policy Center estimates that the top 1% of Americans will pay 32.4% of all Federal taxes in 2016.
• Using Congressional Budget Office and the IRS, the Heritage Foundation reported in April, 2015 that the top 1% of Americans pay 24% of all Federal taxes and a whopping 35% of Federal income taxes.

But there is more. Consider the following detailed breakdown of tax payments by earnings band, as reported by Pew Research using IRS data:



Summarizing these results:

• The top 15% of American earners paid about 78% of Federal income taxes in 2013.
• Thus, the remaining 85% of American earners paid only 22% of all Federal income taxes in 2013.
• The top 2.4% of earners paid almost HALF of all Federal income taxes.
• The 63.4% of Americans earning less than $50,000 paid only 6.2% of 2013’s Federal income taxes.
• The highest earn 2.4% paid about 24 times more their percentage of Federal income taxes than their share of earnings.

You get the idea...even if Johnson does not. The problem is that the political class spends way too much, not that any American is not taxed enough. They waste so much money and now this guy has the gall to ask for more without cleaning up the mess he and others inside the Beltway have created.

As we have reported a few times in this blog, the number of Americans renouncing their citizenship and moving overseas is still pretty small but has been growing steadily during the Obama years. And you can be sure that the thousands that renounce every year are not those earning minimum wage. It is the high income, and high wealth individuals who are tired of being blamed for the ills of the country by politicians who are the cause of those same ills. 

And when these high wealth citizens leave and take their Federal tax dollars with them, it is the rest of us lower earners who will be paying more in taxes to make up the difference. And the problems of overspending will still be there, with Johnson and those like him still having no clue on how to operate an efficient government.

Remember, his priorities are trying to make sure Guam does not tip over and that birthday balloons have enough helium. Tomorrow, we will explode the Johnson increase taxation fantasy by showing that no matter how much you tax the high earners and wealthy in this country, it will make absolutely no difference in the quality of life for every citizen or the financial chaos of the Federal government.

Our book, "Love My Country, Loathe My Government - Fifty First Steps To Restoring Our Freedom And Destroying The American Political Class" is now available at:

www.loathemygovernment.com

It is also available online at Amazon and Barnes and Noble. Please pass our message of freedom onward. Let your friends and family know about our websites and blogs, ask your library to carry the book, and respect freedom for both yourselves and others everyday.

Please visit the following sites for freedom:

Term Limits Now: http://www.howmuchworsecoulditget.com
http://www.reason.com
http://www.cato.org
http://www.bankruptingamerica.org
http://www.conventionofstates.com
http://www.youtube.com/watch?v=08j0sYUOb5w