Following is a summary of the state of dependency in America as outlined by John Merline in Investor’s Business Daily this past week. Nearly everyone recognizes that this path is unsustainable, but not everyone agrees how to fix it or has the courage to do what is obviously necessary to avoid bankrupting the nation. Actually, most politicians – and particularly the current President – continually call for even more spending and additional programs compounding the problem instead of fixing it.
The dramatic increase in spending on various entitlement programs over the last many decades has hardly been a secret. Nor, has the danger to the nation’s fiscal well-being of a failure to address the problem. Presidents and politicians from both parties have said some of the right things for a long time. Even Barack Obama spoke of the need to “pay down our debt” three separate times in his recent State of the Union address– while using most of the rest of his speech to call for more new programs and spending that would do just the opposite.
It is our nature to like to be spoiled, and politicians seeking favor with the electorate are usually willing to oblige. Everybody prefers to receive rather than to give, particularly if the government is on the other end of the transaction. So, even knowing that America is on a glide path to disaster, when push-comes-to-shove few Americans are really willing to cut back on federal benefits. According to a recent IBD/TIPP poll just 24% would support cutting Social Security and only 16% would back Medicare cuts – by far the most costly of all federal entitlement programs.
Nancy Pelosi promised “no new deficit spending” on the day she was elected Speaker of the House in 2007. She broke her promise.
During the Presidential campaign of 2008, Barack Obama said the $9 trillion of federal debt at the time was "irresponsible. It's unpatriotic." Unfortunately, that rhetoric came 6 trillion dollars of additional debt ago.
Out of control, unsustainable spending is once again a big issue in the 2012 Presidential and Congressional campaigns. But, regardless of who ultimately gets elected, it will take not only a change in the courage of the politicians, but also in the will of the people before any substantial reform is enacted.
Today, at 11:20 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for July 24th, 2014 | John Ransom
Today, at 11:20 AM PT: Get the Market Movements in Advance; Williams Edge Webinar for July 23rd, 2014 | John Ransom