The federal government is not broke, the Council of Economic Advisers said in its annual report, although it owes a lot of money.
In 1980, the market value of the government's debt was $981 billion, the report said. But part of that debt is owed to other parts of the government itself, and the government has on hand other financial assets such as gold and mortgages that could be sold.
Subtracting the double counting on the debt and the value of the financial assets reduces the government's net liabilities to $450 billion, the CEA calculated.
The government also owns a vast array of buildings, highways, dams, land and so forth that, according to one private estimate cited, was worth $727 billion in 1980, with the tangible assets valued at replacement cost. That figure does not include the value of oil and other minerals on the land.
On this basis, the government currently has about $277 billion more in the way of assets than liabilities. The council stresses all this is a highly uncertain process.
Even more uncertain is exactly how to count the implicit pledge the government has made to pay Social Security benefits to future retirees on the basis of "tax" contributions paid in the past. This so-called unfunded liability was about $4 trillion in 1977, the latest figure available. "These implicit promises to pay Social Security benefits are not legal commitments; as a consequence, they have a different legal standing from explicit forms of government debt.