The Veritas Tribune: Freedom of Speech, Religion, from DEBT?

I know that government spending has been a source of much debate on both sides of the political spectrum for a good bit of time, and often it seems like there is no middle ground that the parties can seem to reach. That being said, I am going to step out and discuss something I know to be very politically sensitive, in hopes that it will spark some renewed thought on what it means to be fiscally responsible, both personally and politically.

Personal financial responsibility has been something I have been feeling very convicted about of late, so I must say, I am not currently the model of what it means to be working and living to be free of the millstone of debt. Like many students today, I inherited a mortgage of student debt by the time I walked on that graduation stage to receive my diploma. At the time, the money I was borrowing seemed fake, like one day I would not be held accountable for paying it back. I was pretty ignorant to the burden it would cause me later in life. I do, however, believe my degree to have been worth the investment, I just could have been smarter about the way I approached paying for it. I could have also been more responsible with what I did with the money I had when I started to work.

The thing about debt is, it really IS a burden. You end up becoming subservient to your debtors. Your life options narrow the more of it you have. I started to realize the truth to this in the past few months. There is so much good I want to do in this work, serving underprivileged nations, giving generously to those in need, and I realized debt makes all of this harder. I do tithe monthly, but without this debt, I would have much more resource in which to make a difference. I do believe in my heart in the old adage that money doesn't buy happiness, but it sure does provide the wiggle room to be able to make more decisions on your terms, and gosh, wouldn't that be nice?

I have been starting to make a lot of headway against my debt recently, and found that the formula for getting/staying out of debt is behavioral and has roots in ideals you are taught when you are young. Some of these principles are: If you work hard you get paid, if you want to buy something you need to save enough to purchase it, if you don’t want to work you will not be paid, and if you don’t have enough for something, you better save more. It seems to me that staying out of debt becomes a matter of priority. If you want to purchase something, you better find the money for it from somewhere else, and that means conceding something else. Money doesn't just appear. It has to come from somewhere, and the supply of it is anything but endless. For a long time, I had no patience for waiting to have the money to purchase something, and I wracked up debt because of it. When you use a personal line of credit, and do not pay it, you are hit with penalties and interest. I had to realize, was that iPad I wanted so much worth the 499 + interest? Then, if I cant pay it, was it worth jeopardizing my ability to take out a line of credit on one of the only things I believe you should take credit out for, a home?

As a country, we tend to view national debt differently then personal debt. We also tend to approach spending and deficit reduction, very differently then we would in our own lives. This can be a catastrophic mistake.

This month, the Congressional Budget Office released an update to the outlook of the US budget, in which it was found that Obama's healthcare bill would cost around 1.76 trillion dollars between now and 2022 (that 176 billion dollars a year), a full 860 billion more then the President had originally projected. I could not help to think about what an absolutely absurd number this is, and what kind of priority we should assign to such a massive bill, in a time of economic instability. Is this really the place we should invest our money with the kind of deficit we have? Where will this money come from? What are we giving up to pay for this, or are we just increasing the debt burden for our children? The kind of out of control spending has happened before, during the great depression, disguised as providing for the general welfare. As a matter of fact, in the timeline of the depression the deficit reached 120 percent of the GDP during FDR, and with that an unemployment rate that touched 20 percent, and a top tax bracket of greater then 91 percent. Hardly seems like higher spending promoted the general welfare.

In 2009, the US Census Bureau found that 40.8 million US Residents, or 13.4 percent of the US population was without healthcare.¹ This would mean that the US would spend 176 billion, nearly 5 percent of the 2012 authorized spending limit to provide healthcare to 13.4 percent of the population.

It is important to note, however, that healthcare is different then health insurance, and everyone in the United States has the right, by law, to general healthcare, even those here illegally.

As premiums start to rise in anticipation of this socialization of Healthcare due to the impending downgrade in reimbursement rates, the National Physicians Survey conducted a survey in 2011 that showed that physicians believe the quality of healthcare will decrease over the next 5 years, a whopping 3 to 1. It hardly seems intelligent to spend more taxes, for a lower healthcare standard. A Rasmussen survey also showed that 53 percent of likely US voters are in favor of repeal of the Healthcare law.² Physicians tend to believe that the Obama Administration failed to seek sufficient consultation from the industry regarding his reform. With this much opposition to the Healthcare reform bill, I fail to see why the president continues to push for its implementation. I do believe the Government should provide a safety net program to help those who have fallen on hard times, but this bill provides a way of life, not a safety net, that offers little incentive for those out of work to continue looking for work within a reasonable period of time. A safety net program could be something we can do for a quarter of this cost, but there must be caveats that limit the use of such a program, as to prevent reliance. The government’s job is to promote, not provide for the general welfare, and a safety net program could be something we can afford, while allowing the government to fulfill its obligation to its people. Where are our spending priorities?

Much of the problem with lack of healthcare for US citizens is the very slow growth of the US economy, making it very difficult for those who are unemployed to find reasonable jobs that fit their qualifications. Although I disagree with President Obama’s 447 billion dollar American Jobs Act, (as I do not believe offering loans to companies will stimulate the economy nor job growth) and subsequent creation of additional bureaucracy associated with the American Infrastructure Financing Authority (AIFA), I believe that the best thing the US government can do is to invest in the future of America, is to invest in the private sector of major US industries such as energy, telecommunications, transportation, etc. The government should pull a good portion of the money associated with the new health care bill and put it into a US Technology Investment fund, in which the government would put out request for proposals for businesses to competitively bid to receive seed money to develop new technologies desperately needed for the infrastructure of the United States. An example could be a sustainable energy contact focusing on finding better ways to power our cars (to reduce our dependency on petroleum based fuels). Offering such a contract, with a competitive nature, can stimulate innovation, and in turn, help to create jobs. We are seeing the American aerospace community continue to innovate under this kind of environment, and they are doing it for much less the government could possibly dream of doing themselves. It is important, however, for the IP that comes out of companies assisted by this kind of money to remain that of the company, and for the government not to over regulate them. This is a sure fire way to drive up cost.

Tax revenues are strongly linked to the stability of the economy, and the amount of people employed. In 2009 tax revenues decreased by nearly 20 percent from income based taxes, while corporate tax revenues declined by nearly 50 percent. With the US government investing in creating commercial jobs that address strong US needs, I believe tax revenues will start to increase again, and the percentage of those who are uninsured will begin to decline. The key is, make it easier for businesses to do business in the United States, offer incentive for innovation through competitive procurements.

The US government must learn to address the root cause of its debt crisis, and its out of control spending. This blog believes it lies in the exponential increase in the size of government, the continuous struggle of the economy, and a lack of true understand of the role of government in the lives of the people. Thomas Jefferson, in a 1791 letter to George Washington wrote about the general welfare clause in the preamble to the US constitution:

"To lay taxes to provide for the general welfare of the United States, that is to say, to lay taxes of providing for the general welfare. For the laying of taxes is the power, and the general welfare the purpose for which the power is to be exercised. They are not to lay taxes ad libitum for any purpose they please; but only to pay the debts or provide for the welfare of the Union. In like manner, they are not to do anything they please to provide for the general welfare, but only to lay taxes for that purpose. To consider the latter phrase, not as describing the purpose of the first, but as giving a distinct and independent power to do any act they please, which might be for the good of the Union, would render all the preceding and subsequent enumerations of power completely useless. It would reduce the whole instrument to a single phrase that of instituting a Congress with power to do whatever would be for the good of the United States; and, as they would be the sole judges of the good or evil, it would be also a power to do whatever evil they please."

Thomas Jefferson was warning George Washington to the dangers of the "promote the general welfare clause" of such a phrase taken out of context of the rest of the document, and I believe this is what we are doing as a nation today. Taxation out of context of the constitution under the guise of promoting the general welfare is unconstitutional.

The fact is, the US government takes in roughly 180 billion dollars, and spends 300 billion dollars a month. 120 billion dolar monthly increase in the national deficit should be a number, and a reality, that should absolutely transcend party politics. The only way to balance this number (or reverse it as would be necessary to decrease the deficit) is to increase revenues through increasing the amount of tax payers, and decreasing the size of government. We, as a nation, must learn to look back to the general principles we learn when we are young, that if we work, we get paid, and if we wish to purchase something, we must have the money. The continuous addition of government programs without cutting others to account for its cost, can no longer be tolerated. What are we teaching our next generation of children about what it means to be financially responsible? Would we teach them its ok to open a credit card so you can get everything you want, although you cannot afford it all? We must teach them what it means to be financially responsible, and the value of working to earn a dollar. This is one of the greatest gifts we can give the next generation.

Below is a wonderful video from Senator Marco Rubio that I believe paints a perfect picture of the realities of the financial crisis we face, and the hard decisions we will soon have to make as a nation. I highly recommend watching.