“The debt Uncle Sam publicly acknowledges is now $12 trillion. But the true measure of our debt — the one suggested by economic theory — is the fiscal gap, which totals $222 trillion. The fiscal gap is the present value of all future expenditures, including servicing outstanding official federal debt, minus the present value of all future receipts. Detroit’s main means of hiding its true liabilities was discounting its future obligations at a rate far higher than appropriate, thus giving the appearance that less saving was needed to cover the shortfall.  Washington’s dirtier trick has been to keep virtually all of its future liabilities off the books.”

http://www.pbs.org/newshour/rundown/2013/08/detroit-today-washington-tomorrow.html

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