Before you continue reading this post, let me tell you what I think about a few things.
- Capitalism is preferable to Socialism and Communism.
- Christian community (where people freely choose to share their wealth with others) is quite different and distinct from Communism (where the government owns industry and distributes the wealth as it sees fit).
- Operating "in the black" and staying out of debt, is preferable to living "in the red" with the burden of debt.
- Debt obligates the debtor. (That's why it's called "debt.")
- Overspending your budget is generally irresponsible, usually avoidable and always consequential.
- Increasing your debt, when you're already in debt, may relieve immediate pressure but it ultimately increases debt's obligations and pressures. More debt merely delays the consequences you're momentarily avoiding.
Having read that, you may now read this blog.
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I went to Grand Rapids last week to learn how Joe McNally takes pictures. Riding in the car with some of GCC's photographers for a few hours gave us time for conversations about a wide range of topics, including politics. Since I was asked about our country's current economic realities, and the polarizing national debate regarding the merits of either "refusing the raise the debt ceiling" or "authorizing even more debt," I had a few things to say.
We've all heard people argue the one-size-fits-all solution: "If someone already deep in debt runs out of money, no one bails them out. They can't spend any more money. They're stuck where they are and must live with what they have. That's the way it should be with the national debt. Once the government runs out of money, and they've hit their debt ceiling, they should immediately stop spending too." That is said as if the one circumstance is identical to the other, and the way "out" of each situation is the same for both.
Really?
Is comparing the debt ceiling of one person, and the debt ceiling of the world's greatest country (with its dominant influence on the international banking system and its impact on the global economy), the best way to find a solution to our looming national debt crisis? I'm not so sure.
So I told a longer version of two stories, then asked the guys if it made sense to apply the same solutions in both situations.
A Short Version of the 1st Story I told:
Your teenage son putts into the middle of your little 10 acre pond with a tiny 4 HP motor on the back of your row boat. Of course, he doesn't take oars (since he's sure he won't need them) and he runs out of gas. He calls back, "Hey! Bring me some of the gas you've got in the garage! I ran out and I need more! Just put it on my tab! Ha. Ha. Ha."
You call back, "Nope. Sorry. You already owe me for the gas you used all week. I'm not giving you more until you pay me what you owe for what you've already used! Good luck getting to shore!"
What's the worst that can happen? He's got no money and he can't borrow any more. He's stuck. He'll need to get in the water and swim the boat back to shore. He'll learn his lesson and maybe, just maybe, he'll think twice before he foolishly gets himself in a position where he doesn't have the money to pay his way to get where he wants to go.
You can stand your ground and make your point. Maybe you should. He may not like it, but you feel like you're in the right, and he doesn't get a vote in this matter. Why bail him out and risk reinforcing his bad behavior? Cut him off.
That'll teach him.
A Short Version of the 2nd Story I told:
With thousands aboard the cruise ship you've boarded, you get to the middle of the ocean and the captain comes on the intercom and announces, "We've run out of fuel. There's a tanker nearby but they won't give us fuel; they'll sell us what we need to get home if we can promise them full payment once we get back to shore. We understand many of you have no money to kick-in so we can get more fuel, so we're asking those of you who paid the full fare for this cruise to vote in favor of an increase. I know you're already running up your tab for the cruise, and we told you we'd be able to complete the voyage for less than it appears we'll need, but we're not going to make it if you don't authorize us to put quite a bit more on your tab. We'll just add it to the credit card you used to book your trip. Even though we still owe you a 'luxury cruise,' and our poor planning may have caused a few of you to lose confidence in our ability to deliver on our promises, we're all in this mess together. If you don't vote to run up everyone's tab, we'll lose more than our cruise. We'll lose the whole ship. If you don't vote to give us everything we say we need - so we can act as your representatives to fix this problem - we're in trouble."
What's the worst than can happen? You can stand your ground and make your point. Maybe you should. The rest of the passengers may not like it, but you feel like you're in the right. When everyone votes, you can only hope the majority will vote like you. But you know everyone isn't like you, and everyone is going to vote for what they think will be best for them. (After all, that's what you're going to do.)
You find yourself hoping the other passengers who share your interests won't disengage from the process. When the vote happens, those who engage the process will have their position represented; those who disengage from the process won't have their needs represented.
Now, even though you're still owed everything you were promised, the passengers are being asked to vote in favor of running up everyone's tab, and putting even more debt on the credit cards they used to book this cruise. They say it's the only way everyone can get through this mess. But you keep thinking, "Why bail everyone out and risk reinforcing everyone's bad behavior?" Cut 'em off.
That'll teach 'em.
But think about it. The consequences are hardly the same. You're not looking at a teenage boy, stuck in the middle of a little pond, who needs to learn a lesson. You're looking at the loss of the entire ship in the middle of a vast ocean. You're looking at a scenario where everyone loses. Everyone.
Doesn't the complexity of fixing our national budget, and the dilemma of raising our debt ceiling, require something more than a one-size-fits-all solution?
Aren't the potential consequences of mismanaging our national debt crisis, quite different from those faced by one over-extended individual? When it comes to the fiduciary contrast between one person and one nation, the principle governing the financial processes may be similar, but the consequences of fiscal mismanagement and irresponsible debt are dramatically different.
If nothing changes, our consequences are inescapable. We're out of money and we're out of gas. We can either raise our debt ceiling, run up our tab and go deeper in debt, or we can refuse to keep borrowing...which leaves us in the middle of a real mess: out of time, unwilling to keep going the way we were going, in default and stuck here with no means of our own (because we won't raise taxes to pay for more of the same 'ol, same 'ol), and no "borrowed" means (because we won't raise the debt ceiling) to get moving again.
There will be severe consequences, whether we raise the debt ceiling, or not.
If we borrow no more money our consequences are immediate; we go into default on our obligations, lose our credit rating, devalue the dollar and have no more borrowed money to meet our obligations here and abroad.
If we raise the debt ceiling, we delay those consequences, but only for a while. When our creditors realize we won't pay our debt, when the ones loaning us more and more money determine we're going to default on their loans, they'll stop lending us more money. When that happens, the delayed consequences hit and we'll have no more borrowed money to meet our obligations here and abroad.
Where's the moral high ground in default?
What's righteous about promises un-kept, bills not paid, obligations not met or debts outstanding?
Where's the freedom in our bondage to more and more debt?
One day we'll pay back everything we owe. Either now, or later, we'll pay our debts whether we want to or not. Until that time, we're more obligated than Snow White's 7 Dwarfs, so we go to work singing something like, "I owe, I owe, so off to work I go!" Whether we start paying down our debt now or later, we'll keep working to serve our creditors, until they are satisfied that we've paid off our tab and our debt is paid in full.
Meanwhile, let's find a better way to discuss this issue than by claiming, "That's how America's families deal with the consequences of debt, so that's how we should handle our national debt crisis too." Those are similar realities; they're not identical.
These are serious days. We could lose the whole ship.
You're already on board, so buckle up. We're in for a bumpy ride and this is no time for good people to shrink back. Don't disengage from the process, and don't let yourself be satisfied with simplistic answers to the complex questions raised in the face of undesirable and torturous consequences.
Don't expect an easy way over the convoluted, long-winding journey ahead. Instead, look for the narrow way.
We'll be blessed if we find it.
Matthew 7:13-14 - Enter through the narrow gate; for wide is the gate and spacious and broad is the way that leads away to destruction, and many are those who are entering through it. But the gate is narrow and the way is straitened and compressed that leads away to life, and few are those who find it.
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