The Lady Speaks

Neither a lender nor a borrower be…

I don't pretend to understand the high-brow, deeply boring world of economics. What I know is the low-brow, surviving paycheck-to-paycheck, world of economizing.

Money out should at least equal, but preferably be less than the money in. This can be expressed as a mathematical formula: Mo =/- Mi. (I made that up, in case you didn't guess.)

If what you spend is more than what you earn, you've got trouble.

Someone needs to go teach this to His Emperorness….The Decider…the President.

Here's how I explained it to my nineteen-year-old after he got his first credit card: When you [the country] are spending everything you earn, as fast as you get it, on dumb sh*t like stereos and junk food [or wasting it in Iraq and building expensive bridges no one needs] that's bad enough. What you don't do – ever – is cut your work hours [taxes], resulting in less income, while still spending like there's no tomorrow.

That is how you accrue what we like to call 'debt'.

Debt is bad.

Very bad.

People who go deep into debt either from stupidly running up bills they haven't the means to pay, or due to catastrophic expenses, like medical bills, have two choices: end up working for years while living on mac and cheese and ketchup soup to repay those debts – or declare bankruptcy.

They DO NOT get to decide, "Hey, I'm already in debt, let's dive a little deeper." and continue to take out loans and borrow off friends and then say, "You know what? I think I'm going to quit my job and find one that pays 1/3 of what I'm making now!"

Which is what our federal government has done. Escalating war costs (over $278,122,694,710 and rising at a rate of about $2500 a second!), Hurricane Katrina and Rita rebuilding, vanishing reconstruction funds in Iraq, etc., etc. have created a budget deficit of $8,368,889,670,284 – that's TRILLION, with a T – and counting.

We are in debt up to our ears to China which loaned money that, in effect, pays only the INTEREST on those loans. What happens if they decide to call in their markers?

The United States is like an out-of-control teenager. Some kids go nuts once they're on their own – taking out loans on sports cars that they can just barely afford, then using their first credit cards – that were supposed to be for emergencies only – to make the payment because OOPSIE, they forgot to balance their checkbook and it turns out they're $300 in debt to the bank for bounced checks and overdraft fees.

Then, the next month, they lose their job and can't make the credit card payment, they can't write a check, and they can't pay the car loan because they decided to hold a party. They managed to beg and borrow from some friends, but they still aren't working, so now they owe everyone, and they've hit their limit on the credit card. And so on.

From the Associated Press

Bush, who has made tax cuts his signature domestic issue, said extending the tax cuts would provide certainty in the tax code and foster business investment.

“If the people have their way who want this tax relief to expire, the American people will be hit with $2.4 trillion in higher taxes over the next decade,” he said. “It would be handed over to government — that’s where the money would go. It would be taken out of the economy and given to people here in Washington, D.C., to spend.”

Unfortunately, that 2.4 trillion is one-fourth of the current debt, which is rising at a rate of almost $1100 per second! Too bad the 'people here in Washington, D.C' who've been in charge – and control both houses of Congress – haven't had the sense over the past five and a half years to do anything except spend like there's no tomorrow.

Someone needs to practice some tough love and put this country back on a budget. Making these tax cuts permanent helps no one because it continues a policy of "spend and spend, but don't earn a dime" that the current crop of Republicans has perfected.

You think a tax increase now is bad? Imagine what the federal debt will be five or ten years without it. And imagine how high taxes will be then, because the country is going to have to pay off this enormous deficit sooner or later. And later just means higher interest on top of higher debt.


May 4, 2006 - Posted by | Bush, Cheney, Congress, Economy, Federal Debt, Government, Politics, Republicans, White House

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