Friday, April 25, 2008


Promises of hopes and dreams of a greater tomorrow are easily fashioned in whatever vernacular the exhortation might take to energize political agenda. There are certain financial realities, however, all three current candidates vying for the leather seat in the oval office are ignoring. They have to in order to have a chance at getting elected.

The U.S. national debt is over $9.3 trillion and rising, yet it does not fully represent the reality of the government’s total commitment to a retiring generation. This amount has been calculated to be well north of $50 trillion. Given that the total U.S. GDP is expected to be $14.3 trillion in 2008, while the total Federal, State and Local spending will be $5.1 trillion, this looming debt seems difficult to ignore. It is evidently safer to neglect this reality since confronting it would mean preparing a plan and presenting it to the American public, and bad news is never enjoyable. Bearers of bad news are also rarely popular, and never elected.

Clinton is claiming no tax increases for those with incomes less than $250,000, and Obama is committing to tax cuts for incomes less than $250,000. Since the average taxpayer earns one fifth of that, and only the top three percent are in the Clinton and Obama unprotected income range, where do they expect the funds to come from?

There is also a dissonant refrain, repeated recently by McCain, that cutting taxes will stimulate the economy, as in top-down or trickle-down. This hasn’t worked so well in the past since the real incomes have been stagnant for a generation and supply-side economics have in fact coincided with increased deficits. It is also a strange and demeaning concept, or should be, for a vast majority of the population.

There are few in Congress who could be accused of being fiscal conservatives. All have been big spenders. It is amazing that somehow Republicans have been able to convince taxpayers that they are against big government and the Democrats convey the image that they are for responsible government. Neither claim is based on truth or evidence. Being against big government has really meant being against oversight of any kind while you spend your way into the history books, and responsible government has really meant just keep spending while pretending you don’t really want to, or mean to.

There is a dearth of options and the few that exist are unpleasant for the average tax payer. Nevertheless, each individual has the ability to participate in the long term economic recovery and each has a responsibility to make wishes heard by elected representatives. The challenge lies in finding representatives that can do more than listen.Each voter has an obligation to empower and demand difficult decision of their elected officials.

All levels of government will be obliged to drastically reduce spending and increasing taxes. Taking difficult action will be the only way to prevent America and its economy from lapsing into a depression forcing years of hardship as borrowing continues unabated.

The coming five years will define America’s ethos as it makes difficult decisions. Taxpayers should not tolerate inattention to the challenge. Doing so would allow the world’s respect to shift and slide into the nether regions of human sentiment and into pathos.


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