Saturday, May 16, 2009

Dr. Spendthrift or: How I Stopped Worrying About Budget Deficits and Learned to Love the National Debt

(with apologies to Stanley Kubrick and Peter Sellers)

One of the great satires of all time has got to be "Dr. Strangelove" starring Peter Sellers in 3 masterful roles and George C. Scott as the blood-thirsty, staunch anti-communist General 'Buck' Turgidson.

The scene that is always remembered from the movie, though, is the one near the end when Slim Pickens as Major T.J. Kong completes the misguided and mishandled public policy objective as he rides "the Bomb" down to its final appointed destiny.

Don't you get the same feeling nowadays as you are bombarded by the relentless news cycle of bailouts and more bailouts, stimulus plans, health care program expansion, and on and on and on? Are we on some sort of automatic pilot for federal overspending that has passed the fail-safe point of no return?

Isn't there something in our collective human brain that can act like some sort of regulator on our spending habits as a nation? Sort of like your stomach when it is full? After you have eaten so much that you feel like your stomach is going to pop, don't you just put the fork down and rest for awhile?

Here are some questions I have been asking anyone who does not think the exploding budget deficit is 'dangerous' to our future as a Republic. Has there ever been a nation in the history of mankind that has been able to out-spend its tax revenue base forever and survived? If so, name them with dates and leaders and location cause I have not ever heard of one yet.

If $10 trillion in debt does not bother you, and the prospect of having a $20 trillion national debt right around the corner doesn't terrify you, then why don't you go ahead and advocate unlimited spending and deficit-spend until the national debt gets to $100 trillion in 2015 or so? Why not? We could give everyone Rolls-Royces and Rolex watches on top of health care and all these bailouts for horrendous business decisions and make everyone happy in the short-run so why not let's just keep on going?

What makes you think we are any different than our parents, grandparents or great-grandparents and we are the first ones in history to not have to worry about balancing our federal budgets and national fisc? Is it because we are Boomers and nothing really bad has ever come our way, until this Really Bad Recession, that is?

We have had free love, free sex, freedom to use drugs, an amazing amount of wealth to spend on ourselves and do as we please (cue more freedom music from Bob Dylan, Joan Baez and Richie Havens, please!) so why shouldn't we be entitled to be 'free' to spend as much money on us as we want?

My point has always been to try to remind these well-meaning but, in my mind, misguided and sadly deluded individuals that we, as great as we are as a nation, have not repealed the basic fundamental laws of gravity, economics or finances. We couldn't even if we tried.

Now we are paying the piper for all of the excesses we have indulged ourselves with over the past 40 years and it is just going to take a while to work off the imbalances in almost every sector. Alan Greenspan, as surprised as he was by this economic conflagration, points out very clearly throughout his otherwise excellent book, "The Age of Turbulence" that everything reverts back to the mean over time.

We are just having a 'mean' time of it right now and we should not be raising our future debt and obligations by the exponential rates we are now doing. Call or write your elected representatives and senators in Washington and tell them how you feel about it.

If you don't mind building up this massive debt load, just remember the great scene of Major Kong you just saw. That is what the rest of us feel like we are doing.

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