For Worse Or For Better

                                                                                              

Perhaps Thomas Wolfe understood better than we. In his book You Can't Go Home Againⁱ he wrote:

“They had flung away the earnings of a lifetime, and mortgaged those of a generation to come. They had ruined their city, and in doing so had ruined themselves, their children, and their children's children.”

He was speaking of debt incurred in the hope of making money in the future. In the situation he described, it paid for building, but it really represented the present's destruction of future generations. It was, after all, they who would wind up responsible for it. Their frenzied action, their rush to provide for the future, would hurt not only themselves, but those for whom they were building.

That was private debt, but it's no different, or perhaps it's worse, when a government, in a rush to provide for the future, doesn't consider the consequences of its actions, and saddles those who follow with the cost of our sins. We're now servicing the debts piled up for us by prior administrations and making it worse for our children and grandchildren – the “generation to come,” or, more accurately, the generations to come. We have “mortgaged” our future and theirs.

There isn't much we can do about it. At least not quickly. But we can take steps to prevent the situation from worsening. The debit/credit card proposal which I discussed last weekⁱⁱ could be a tool in such an effort but it is only a part. Especially important is the debit card side, one linked to a savings account, since it is critical that we pay for everything from this point on rather than increase our debt. It's easiest to understand our problem when we consider our national expenses: they can be summarized by the mnemonic “DEMISE,” and they are Defense, Entitlements, Medicare and Medicaid, Interest on past loans, Social Security, and Everything else. Two of them, defense and interest, are specifically listed as justifications for taxation in the Constitution. The others, like Topsy, just grew up along the way, but they are adding to the crippling debt we now have, and to our overall budget problem.ⁱⁱⁱ

The one of greatest interest to me in this series of essays is “Entitlements.” (I suspect that the government credit card discussed in the previous essay would be helpful in decreasing the costs in the other categories, but I shall not pursue that at this time.^iv) I began that discussion a couple of weeks ago, and I shall continue by listing a series of short statements about them (entitlements). Perhaps these repeat what I've said in the past, but they will help clarify some points in the present discussion.  They are not in the Constitution but they were created by our (Federal, State, and Local) government(s).

1. Many view them as mandated charity^v which, like many other programs, they have to fund as taxpayers, whether or not they agree with them or can avail themselves of them.
2. They have been subject to billions of dollars of fraud which has added to the bill we all have to foot.
3. Using guilt and the proper code words and jargon, our representatives, with misleading claims, have been able to convince the voters that they want these programs.
4. People are generous with the government money that funds the benefits because they don't see it as their own, even though they are supported through taxes. Tell them how much their taxes would go down for each one eliminated and they might be more frugal.

Of course there are many other programs which we have been forced to fund that are not listed in the Constitution, and many taxes not foreseen by the Founders, and these, too, contribute to our debt. I shall deal with those as well when I make some suggestions about possible changes in our tax policies, and I shall continue the discussion of this problem next week. At that time I'll mention some of the other tax-supported areas that might profitably be rethought.

Next episode: “Buyer Prepare” – You pay for what you get. Or, at least, you should.

i      1940

ii     “The Route Of All Evil,” April 21, 2013.

iii    http://www.usdebtclock.org/ I've given this reference before, but as we approach a national debt of seventeen trillion dollars, it's well to keep the figures in mind. Soon enough we, or our descendants, will have to pay the piper.

iv     I'll make some mention of it in the future, but I'm sure you can come up with additional uses for such a card.

v    True charity is voluntary, not mandated, and the result of the individual considering what he is willing to give, and for what purpose.