America’s Yard Sale

Oil may sell for $100 a barrel, delivered to the refinery. But it may cost more than $100 to deliver it. That’s why most of the world’s oil ‘reserves’ remain in reserve.

Bison crossing a road in Yellowstone National Park, Source: Getty Images

Thursday, August 27th, 2026

Bill Bonner, from Poitou, France

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Dan sent an intriguing thought. What if US bonds were not ‘certificates of guaranteed confiscation’ after all? What if America’s credit was well secured...by trillions of dollars’ worth of real assets? Dan:

Yesterday a guy I follow and respect said the $40 trillion in debt is secured by America’s massive (not quite infinite) natural resources...land, water, food, energy that sits on public lands ostensibly ‘owned’ by the American people. His implication was that these public assets more than balance out the $40 trillion in debt. We’re good for it!

The thought comes up from time to time. What’s Yellowstone worth? NASA? Millions of acres of prairie? The Washington Monument? Cape Canaveral? Are they worth enough to cover a $40 trillion in debt...along with $15 trillion more in pension and prostate operations for federal employees...not even to mention the trillions more in ‘mandatory’ spending in line behind them?

But many of America’s most precious assets never show up on the balance sheet. Gold, for example. The feds carry their gold on the books at $42 an ounce. It’s actually worth more than 100 times as much. That alone would bring in about $1.2 trillion at auction...enough to fund the government for about two months.

Then, there is land. The feds own 640 million acres — more than a quarter of the entire US landmass. What it is worth is anyone’s guess...since dumping that much property onto the market would surely crash prices. And even if you could sell it for an average of $100 an acre (think of all that desert and uninhabitable wilderness), it would still only net you $64 billion, again, enough to keep the feds going for three days.

And here is where we’re beginning to see the vast gap between reality and fantasy. An acre of Alaskan forest is real...it has a real value, based on where it is and how it could be used. But the debt numbers are fantastical...wisps in the wind...unimaginable...unfathomable...and unmanageable. When you look at them hard, you see that no plausible combination of real things can measure up.

Proponents of the ‘the feds are good for it’ hypothesis turn to the near-mythical ‘resources’ under federal land — oil, gas, coal, minerals etc. They claim they are worth as much as $200 trillion — far beyond what the feds owe. Hurrah, they say. Problem solved.

But look again. Oil may sell for $100 a barrel, delivered to the refinery. But it may cost more than $100 to deliver it. That’s why most of the world’s oil ‘reserves’ remain in reserve, until the price rises enough to make them viable.

The Cato Institute had a go at better numbers. Its Randal O’Toole did the math and came up with as much as $2 trillion worth of energy resources, along with less than $2 trillion more for the land itself.

Of course, the feds have much more in assets. The General Accounting Office says they have $2 trillion in (mostly) student loans, $1.4 trillion in buildings and equipment, $1.2 trillion in cash (last year) and military hardware worth about half a trillion more.

Source: Bonner Private Research

There really is no way the feds are ever going to auction off the nation’s treasures. Who in Congress would vote to sell Yellowstone, for example?

But let’s imagine that the sale would go on. Picture the excitement when the Pentagon holds its first lawn sale. Israelis, Iranians, Chinese — what a marvelous collection of eager buyers. They would kick the tires on jeeps...climb up on the half-tracks...and try out the rocket-launchers to make sure they were in working order.

And then, after the buyers had gone home — laden with F-35s and huge tracts of empty land in Wyoming and Montana (one of which included an ICBM silo!) — the feds could count their money.

Damn!

Selling everything, even the Lincoln Memorial, would bring in less than $15 trillion, and probably much less. After all, how many of those student loans are actually collectible?

No matter, the ‘going-out-of-business’ sale might bring in enough to retire a third of the national debt. But wait. Deficits add about $2 trillion to the debt each year. Within six or seven years, the debt would be back to where it was...

And then, having sold its buildings, land and other assets, the feds would have turned themselves from proud owners to grudging tenants...and instead of receiving lease payments, grazing fees, timber rights, and royalties, they would get nothing.

The feds would still be in business...and still losing money...but without a pot to you-know-what in.

Regards,

Bill Bonner

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