The richest and wisest man who ever lived, Solomon, counseled us in the Book of Proverbs that “the prosperity of fools will destroy them.” Notice that Solomon did not say prosperity will ruin anyone, but the fool only. So his wisdom is simple: If you have wealth, don’t be a fool with it and you will remain prosperous. If you want wealth, remain wise and not foolish and you will gain it, and hopefully keep it.
Now let us look at that foolish institution called the United States government.
Our great country grew from a late 18th century economic joke into the world’s super economy in a little more than a century, with much of the phenomenal growth coming in a 50-year period from 1865 until World War I. Using wise policies the United States led the globe in every conceivable economic category as the 20th century began, and all because of free market capitalism. The government was largely absent. Continue reading
Confederate President Jefferson Davis remarked during the War for Southern Independence that “If the Confederacy fails, there should be written on its tombstone: Died of a Theory.” President Davis was referring to the political theory of states’ rights and how it was undermining the war effort, as state governments were constantly resisting repeated calls for cooperation with Richmond.
Should America fail, our tombstone should read: Died of Politics. As the nation stares a serious fiscal crisis in the face, most of the political talk in the last couple of weeks has centered around a Missouri US Senate candidate’s stupid remarks about rape, as the Democratic Party and its allies in the media attempt to tie the comments to every single Republican, including Romney and Ryan.
Our political culture has become so inundated with petty, partisan politics that it is becoming more and more difficult to get much-needed reforms enacted because any serious discussion of major policy changes is meet with the usual litany of demagogic attacks designed to scare one group or another in order to score political points. Continue reading
Serious political talk centered last week on the latest Congressional Budget Office (CBO) report that warned of an oncoming “fiscal cliff” if the Bush tax cuts expire and previously agreed to spending cuts are implemented in January. The CBO estimates that if those two things occur, then the economy could plunge into another recession. Unemployment would hit 9 percent and the economy would shrink by 0.5 percent.
Frankly, I see no fiscal cliff in the CBO’s report if the spending reductions are enacted or even if the tax cuts expired. A rise in unemployment from 8.3 percent to 9.0 percent and an economic slowdown of less than one percent is in no way an economic crisis. The good news is the deficit would be cut nearly in half.
But the CBO analysis is flawed, given its findings, for it is the continued accumulation of massive deficits and debt that will drag us over the cliff. Our economic history does not show that cutting spending during hard times will cause a recession. It didn’t happen for Martin Van Buren, Grover Cleveland, or Warren Harding. Continue reading