What happens if we can't pay our bills - July/August 2011
The national debate has revolved around what to do to reduce the rate of deficit spending and with every proposal to cut spending, some group or several groups will react with press releases explaining how such cuts will have a devastating impact on the folks they represent.
The response here in the U.S. however has been fairly muted compared to the reactions in Greece. How much of the activities we see in Greece can we look forward to in the U.S. should we not be able to adequately address our spending problems?
In watching the reactions of Greek citizens to the measures taken by their politicians I am somewhat puzzled by many of those folks strong resistance to cutting spending. Since the only way I can relate to economic actions on a national level is to bring it back to a personal level, I can't understand anyone who argues that they should be allowed to continue spending at levels they know they cannot pay back. I can't get my arms around this concept that buying something but then refusing to pay for it is OK. As I say on a personal level that seems pretty close to stealing, with the only exception being we use an intermediary like a credit card company.
Of course on a national level it is easier to argue that we aren't really stealing, because the money that is collected in the form of taxes should pay for the particular program I feel is important instead of some other program. This sets up an interesting thought process. If I have the same credit account as my wife and we neither one believe we should be the one that has to exercise self discipline when we go to town then it turns into a contest. This process can work for a while, but eventually it will catch up with us. It doesn't really matter that I've got all those neat tools sitting around my work bench if I can't pay the grocery bill.
I would like to think that U.S. citizens would react by pulling together and sacrificing to try to overcome the threat to our national interest; like we would do if attacked by an outside entity. In the end I suspect, like most self imposed problems, we will get into a fight over who should get the remaining crumbs.
That is why politicians who begin federal programs should realize that adding these programs is the easy part. Paying for them or having to eventually cut them in order to keep the country from going broke may end up in riots because no one is willing to give up their portion. In the end a better solution to a problem is to not start a government program, but to seek to solve the problem without a long term commitment of tax dollars.
By Ken Hamilton, Wyoming Farm Bureau Federation Executive Vice President