More Fiscal Responsibility Blues

(part 1 of a 3 part tirade :P )

A Washington Post column on John Kerry, while intended to be sympathetic, brought to my attention for the first time his planned fiscal policies. While he refers to the current budget as "fiscal insanity", his grand master plan is to undo some of the Bush tax cuts and to reduce the deficit by half over four years. Half? And even this pathetic endeavour is fueled by what the column refers to as "overly optimistic" projections. That disgusts me.

The nation's fiscal future is currently our biggest crisis. Not terrorism, not health care, not education, not prescription drugs. We are sitting on an economic time bomb (as wonderfully described by a Robert Samuelson Post column) and in the confluence of a number of long term negative economic factors. This is facing up to be the greatest challenge to the union since at least World War II and possibly the Civil War. If nobody takes responsibility on this it is inevitable that the dollar will eventually collapse and hyperinflate, and we will be lucky to emerge from the ensuing slump after a decade or two. There will come a nexus point when our ongoing fiscal foolishness collides with our declining economic stature in the face of globalization and the crushing onrush of baby boomer dependency on government services. It won't be pretty. Who knows how global security would unfold in the wake of the collapse of the world's foremost power.

This is all right there staring us in the face. I don't think there are many people who would seriously dispute any one of the points that: a) Our current fiscal policies are totally unsustainable, b) Economic globalization will lessen the US's dominant economic position and will tend to disperse our concentrated wealth, c) The retirement of the baby boomers will cause a major economic crisis for the US. Is it so hard to put these ideas together and see where they lead? How can it be that this is not a part of our national dialogue? How can John Kerry believe that hopefully, if we're lucky, reducing the deficit by half over four years is a solution? I've been a bit discouraged by Howard Dean's positions on the deficit as well. Sure he says he's going to balance the budget, but he also says he's not going to touch military spending, social spending, education, etc, etc, and that he's going to increase homeland security spending. Doing all of that and balancing the budget would be a neat trick. I suspect that he, like Kerry, is figuring some absurd economic growth rate into his equations. However, Dean's gubernatorial record leaves me optimistic that when push comes to shove he'll do the right thing. He has a reputation of being fairly ruthless when it comes to balancing his budget, cutting services and social spending where necessary to get the job done. In any case the other candidates have not done much to make me believe in them on this issue.

I'm not sure if this is a problem that can be solved at this point. I'm not convinced that it isn't already too late to altogether avoid this crisis. But certainly if we start soon we can try mitigate it. And balancing the budget and paying down the national debt, getting our fiscal house in order, sounds like a good start to me.

(up next time: Democrats, have a clue on globalization)