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Saturday, Mar 28, 2015

If we don't face debt now, when will we?

More Than Words


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America dodged another government shutdown bullet when Congress agreed to fund our government until December 15th and raised the debt ceiling until February 7th. So our massive federal debt lives on.

Since our country is inexorably moving left to an even-bigger federal government, nothing will be resolved until we have a fiscal crisis some years from now resulting in protests and riots at which time a government controlled by Democrats will be forced to cut entitlement costs - starting with Social Security and Medicare. This has been the experience of all welfare states.

Progressivism has evolved in the U.S. to where it is now centered on the concept of a large national government directing the destinies of its citizens. To that end - now that it has its unaffordable social programs in place - it must attempt to manage our massive economy, which is the end product of a peculiarly American entrepreneurial free market system and has been our hallmark since our founding. It simply cannot micro-manage an economy this large .

The majority of jobs in the U.S. are created by thousands of entrepreneurial small businesses. (It is estimate that 543,000 new businesses are started each month!)

Wealth creation leads to capital investment, which leads to profits and jobs which lead to tax revenues to pay for all the stuff people want to have - social programs and infrastructure.

Money simply doesn't go to work while sitting in the U.S. Treasury. It only becomes productive in the private sector.

It is impossible for an economy this large, in the third-most populous country on the globe, to be centrally managed. Large corporations have learned this the hard way. Leadership is vital - but management is delegated. (How about the private sector or state government?)

A nimble, small, centralized social democracy can pull this off, but not a large country. At a recent conference of international government officials, one panelist observed - to the chuckles of the audience and panelists - "If you want to experience the American dream, go to Sweden." The population of Sweden is 9 million. The population of socialist France with its failing economy is 65 million. The population of the U.S. is 316 million. (The most widely admired socialist welfare state is Sweden with a center-right government. Center-right in a social democracy? Go figure.)

Conservative Republicans simply cannot market themselves. Even the tea party, which is an acronym for "taxed enough already," is portrayed by progressives as a party that does not support social reform when that is clearly not what it stands for. It came into being as a group which opposed big government with excessive governmental spending and high taxes. Progressive liberals label all Republicans as tea partiers, and cleverly deprecate them by creating absurd wedge issues, such as starving the poor (food stamp fraud) and identity politics (Washington "Redskins") - anything to avoid talking about the 800-pound gorilla in the room - our impending fiscal crisis.

Republicans cannot sell themselves to young people - educated or otherwise - or to the "cool" among us. Barack Obama is a prolific guest on vacuous talk shows and proved his vocal chops on the "Late Night with Jimmy Fallon" show when he "slow jammed" the news to wild applause from a college crowd at the University of North Carolina. Bill Clinton became a rock star when he played a mean sax on the Arsenio Hall show wearing cool dark shades.

Unfortunately this is how a Democratic candidate demonstrates his leadership abilities to a large segment of the Democratic coalition.

Republicans can't appeal to young people because they are the boring grown-ups. One could make a credible argument for Republicans to nominate a candidate who can to sing contemporary pop rock or play a cool sax or upbeat electric guitar.

Should a leader try to elevate the culture or adapt to it? Should a leader encourage voters to pay attention to the new ideas to get the new jobs in a changing job market and to understand the extraordinary cost of big government; or should a leader focus on ideological lectures and entertainment to gin up the vote.

Something has to be done to get a handle on our mind-boggling, escalating debt. Who will do it? I would argue it has to be conservatives - Republicans, independents or Blue Dog Democrats.

Boomers are slipping into retirement, so it will be up to Generation Y and the millennials. They need to understand that this administration has created a new normal with unsustainable deficits they will inherit.

The preamble to the Constitution begins, "We the people of the United States," which, when written by the Framers, not only meant those citizens living at that time, but also their "posterity" (future generations). Both were and are to be the beneficiaries of this "perfect union."

Liberal progressives either do not understand the inherent danger of structural over-spending or cannot see any need to address it. It is clear from the writings of the Framers that they never anticipated a country living with a perennially maxed out credit card. Given President Obama's strong support among voters aged 18-29, it's not clear they see any cause for alarm either. Republicans simply cannot persuade any segment of the Democratic coalition to resolve this systemic issue.

If not now, when, and by whom?

Congressman Paul Ryan, in referring the next looming debt crisis in February, said, "I hope we can get a down payment on our debt - a short-term increase in our debt ceiling on the way forward to debt resolution."

Hope springs eternal.

John Reiniers is a retired attorney and a regular contributor who lives in Spring Hill.

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