Sadly, that debacle was simply an episodic manifestation of the deeply structural economic vulnerability created by the dissolution of America's moral fiber. I was led to ponder this recently as I read Jerome Corsi's WND article Forecast: Debt to dwarf GDP:
"The debt level of the United States is unsustainable, something has to give," said Rudolph Penner, former head of the CBO and co-chairman of a report issued last week by the National Research Council and the National Academy of Public Administration.
"The panel suggested four different solutions, varying the mix of entitlement program spending and tax increases in the policy alternatives." All the alternatives involved some mix of national restraint in the form of lower spending, higher taxes, or reneging on promised Social Security and Medicare benefits for the elderly. It's ominous that "all four budget alternatives were constructed with a view to keeping the U.S. debt on what the panel considered a sustainable ratio of 60 percent U.S. debt to GDP." Apparently the panel gave no consideration to any alternative that would place the debt slavery of the American people on a path toward extinction.
fully funding almost all U.S. governmental debt obligations (including state debt) as the new Federal government was launched, and borrowing to finance the Louisiana purchase, the ratio of debt to GDP under U.S. Presidents who were leaders during the Founding period fell to below 10% from a high of 35% in 1792.
The purpose of setting a strategic goal is to discipline the planning process. The implementation of plans, however, depends on the effective discipline of the people who must carry them out. Thanks to the delusions of socialist (Keynesian) economics, after WWII the U.S. government abandoned the strategic goal of debt reduction. Thanks to a politics based on those same delusions, the American people were encouraged by self-serving political leaders to abandon all semblance of personal discipline as well. This culminated in a "we can have it all" approach to government finance that gradually corrupted the whole financial system.
For the last two generations the American people has behaved like the spendthrift heir of fiscally responsible parents, indulging in a debt financed spending spree. We have squandered the moral capital of international trust and confidence accumulated by the generations before us. This has partly been the result of materialistic self-indulgence. But ironically, it has also partly resulted from the moral impulses of compassion. The problem is that there is a lie at the heart of the supposed good intentions. The lie is revealed in the preference for government as the instrument of compassion. It allows people to bask in the warm glow of doing good while avoiding any real personal involvement or commitment.
For example, the natural plan for social security rests on the simple premise that, as parent are obliged to take care of their children, so children are obliged to take care of their parents. On the one hand, this plan requires parents who work and sacrifice for their children, and children who respect the example and authority of their parents. On the other hand, it requires children who accept the work and sacrifice involved in caring for their aging parents; and parents willing enough to forego the pride that would otherwise prevent them from accepting some degree of dependence upon their children.
Simply by reestablishing this natural and age-old system for mutual self-reliance, we would slow the demand for government entitlement, increase the stock of human and material help available to every individual in need, and alleviate the fearful sense of vulnerability that leaves so many prey to the notion that their personal security depends on the government's authority and largesse. The symbol of the successful acceptance of the sharing and mutual obligations, constraints and sacrifices the natural family system involves is the coming together of the generations under one roof, grandparents and parents, children and grandchildren making room and mutual provision for one another as the givers and receivers of example and care.
How have we become a people for whom the prospect of actually living in such a household subtly offends our sense of personal freedom, aspiration and pride? I'll further explore the ramifications of that question in my next posting.