The Economist gives us this sobering look at deficits. The numbers are scary enough...the game just can't work the way it does. Maybe our economies can pull themselves out -- inflation can devalue the debt, growth can lessen it, and perhaps those are the restructuring mechanisms that will let us escape.
The dissolution of national finances brings us to a different place, where the common rules simply don't apply any more. We're left with nothing but hands and voices and mouths, demanding more than exists, and a great pent-up pressure inside all of us. In a sense it will break down society. Much of what we take for granted will disappear -- the fundamental financial relationships beneath the structure of our lives will be disrupted.
What happens when a huge generation of retirees demands care and feeding a younger generation burdened by tremendous taxes, a generation that feels betrayed by their elders?
What happens when the gap between rich and poor becomes progressively more unsurmountable?
I think the barriers of civility that exist between us all are in some danger. And perhaps that is a good thing; our politeness and our deference prevent us from saying what needs to be said.
National problems are not being dealt with. They're being swept under the rug. The youngest adults among us, those in their 20s, are the ones who will face the worst of this. Of course, sweeping problems under the rug is nothing new. The sheer scale of what's going on right now is incomprehensible, though...which leads me to a question:
How have civilizations dissolved, in the past? What are the patterns we need to look for? What can we do to stop it?
The leading indicator, in my opinion, will be the number of states that are forced into financial default. California is disturbingly close to this situation...and other states may follow.
Will the governments of those states raise taxes to balance their budgets and make some headway against the deficits? I doubt it. Or maybe some kind of limit will be reached, eventually, where politicians will become sufficiently disgusted with their own behavior that they will once again find an ethical center within themselves, and begin to govern reasonably.
The carrion call of the conservative is the ineffiency of government. I believe it is better to have inefficient but honest government, than a government that is fundamentally dishonest about its intentions. Our current administration demonstrates this amply -- the stated purpose of tax cuts is to "constraint cash flow into the government", which presumably results in smaller government. This is the pretense under which we are sold smaller tax cuts for the friends of the administration -- you know -- the "Rangers" and "Pioneers" whose benefits from the tax cuts far outweight the "donation" costs involved.
The reality is that the current administration has not coupled its tax cutting efforts with any spending discipline whatsoever. And that tells you everything you need to know. It's fundamentally dishonest to tax cut now, and then shove the problem of how to deal with the resulting financial mess into the future.
We once discussed the theme of the Greatest Generation. I am sad to be surrounded by its pale imitation, the Greediest Generation, slick with the sweat of its red-faced and self-righteous petulance, and mountains of debt-ridden possessions...
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