MONEY

1/18/13

MONEY

You think you want to be president?

This past week should have put each and every would-be candidate off his/her feed.

Just when it appeared one problem might be on the way to being solved, another problem exploded in the president’s face.

Just when triumph seemed at hand, reality bit, hard.

Joe Biden delivers his report on gun control measures on Tuesday. On Wednesday the president announces a plan that seems wide-ranging and sensible.

And on Wednesday afternoon militants in Algeria kidnap and hold hostage an unnumbered group of international oil-workers, including Americans.

Watching and listening to all this, we have a new respect for the office, and the man, currently between rocks and hard places in too many corners of the world. Afghanistan, still. The homefront, not just violence but seemingly intractible debt. Sandy’s bail-out money is stalled in Congress, leaving thousands of citizens underwater, literally.  Chuck Hagel and John Brennan are facing confirmation fights. Cabinet members are resigning by the truckload and need to be replaced, and confirmed.

It’s a wonder this man can get any sleep at all and yet he seems ready to try to tackle one problem after the other, systematically.

You think Herman Cain, Michelle Bachmann, Rick Perry et al could possibly have been up to this job? It may be time to advise parents across the country to stop telling their children that they can grow up to be anything, even the President of the United States.

All this and at the same time President Obama is still the target of bigots and pseudo-historians. And now, this week, as well, his children are being criticized for having Secret Service protection.

We think we have been blessed not with someone infallible, but at least with someone who has patience, knows what’s worth fighting for and what’s not, and still presents the country with visions of the future that are hopeful and sensible.

Which brings us round, once again, to the problem, THE problem, of debt reduction and a new debt ceiling.

In an effort to make this understandable, even though we are not an economist, herewith a simple enough breakdown, via a lesson in contemporary financial practices, that may help us all glom onto how we got here and what we need to do.

First of all, the United States of America has long been generous with its money. Partly, of course, because we have had, up until now, so much of it. Partly because we believe in those efforts we undertake to be healthy, right and proper for a leader such as we have been internationally.

We have been spoiled, in other words. We have convinced ourselves that we have all the money in the world necessary to solve the problems of the world. It has become axiomatic that the US will step in to help when an international disaster strikes, when a domestic tragedy occurs, when we see need and poverty not only abroad but in our own country.

Our debt ceiling is an example of this good will gone awry.

The long and short it is it that whenever we set out to solve a problem, domestic or internationally, that calls for an infusion of US funds, we’ve done it, or at least tried. We never worried about whether or not we could afford a project. If it needed doing, we said yes, through our members of Congress, and then went full steam ahead.

Our national debt goes back hundreds of years, and through more than one hundred Congresses.

Briefly, the national debt has been dramatically increased by “grants in aid” promised by Congresses to various organizations and causes over the years, including the fabled earmarks. The remainder of the debt may be somehow divided between allotments for social programs (also approved by Congresses in the past), wars (again approved by Congresses of the past), and the necessity from time to time to borrow money from others to meet our excessive spending habits of all kinds and on which we pay interest.

This is a gigantic problem of our own making, or rather actually, of Congress’s…with our assent.

This is a simple road to perdition. When we promise to help disaster victims and their families rebuild, when Congress agrees to the amount of foreign aid to be spent each year, when Congress does not allow Medicare to bid competitively for drugs supplied at discounts to its members, we are in effect giving revenue away. We end up owing money to these projects by virtue of agreeing to help, and the amount of revenue brought in each year declines by the same amount.

So to all our brave and foolhardy newcomers on the Hill who think of debt in the future instead of having been racked up by their own institution in the past, here’s a bulletin. The debt ceiling works exactly as your credit cards do.

You order something online, pay via a credit card or Paypal, and you promise therefore to pay that amount to your card-holder. This becomes a debt from the past, for which you are now on the line. (Generationally, if you can’t pay or you die, your heirs are on the hook for your spending. Which leads demogogues to complain we are enslaving our offspring by loading them with more debt than they can handle. But its OUR debt, not theirs.)

Please note: these debts do not in any way promise that we will keep spending at the same rate on the same items. We’re only talking here about what we have already bought, and for which we owe fees and sometimes even interest.

To run a government that has taught its citizens not to worry about money is not only unwise but back-breaking. You, as our representatives, voted to spend. We as voters allowed you to spend. And the bill is coming due.

The debt ceiling idea is simple. Do we as a nation pay our bills from the past, or do we walk away from our nation’s obligations and destroy our own history for being dependable, fair, and solid?

There are many in Congress today who seem to believe that the US is so important to the world that to not pay our debts, to close down the government completely, is simply a fifty-fifty gamble and that the world will forgive us our debts as we have often forgiven our debtors.

In their desire to shrink government, to starve it of funds in the future, they seem to believe that future fiscal discipline will trump past fiscal folly.

What they can’t seem to understand, among other ideas about how to govern and how to prosper, is that among the populations most likely to be maimed by sudden cutbacks of all kinds is our own. Which is to say, job-holders, men and women both, who have been taught to depend on government largesse and whose lives will be shattered as they lose their incomes and opportunities.

Having criticized the government and the president for four years for high unemployment and stagnant economic growth, these cowboys seem beyond understanding what exactly their plan would do to those precise problems.

The rest of us aren’t.