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Works and Days

St. Obama and the Debt Dragon

July 16th, 2011 - 9:37 pm

2012 on the Brain

The Tea Party won the largest midterm election victory since 1938 on the theme that Obama’s rate of borrowing and debt-creation were unsustainable and made worse, not better, by massive new Obama health care and green initiatives. So Obama, now well below 50% in the polls, is to be reinvented as a reasoned budget cutter. Note the logic that suddenly after ObamaCare and green fiascos we pause in midstream, and talk of fiscal restraint and again more taxes. The thinking is analogous to this: the adolescent takes the chronically indebted family Master Charge card, maxes it out, has no more credit, and then asks his father and mother to take on additional jobs to find the money to pay off the debt, but while insisting that he keep all his previously charged junk — and the card as well. At some point in July 2011, all the money borrowed since 2009 was deemed absolutely essential. Nothing was wasted. There was no fraud. Instead, all that $5 trillion saved lives and the planet as well. Borrowing a trillion dollars for ObamaCare cannot be renegotiated.

Obama 2.0 is talking, then, of some cuts to projected added expenditures, not going back and cutting a $1 trillion ObamaCare initiative or the tens of billions in green subsidies, much less just balancing the budget by adopting the 2007 budget levels. Any argument that government expenditures have reached a record percentage of GDP, or that combined state, federal, and payroll taxes can gobble over 50% of one’s income, or new figures that the U.S. is the most progressively taxed of the Western democracies, or that almost 50% of the population pays no income taxes, or that 5% now pay almost 60% of the aggregate income tax obligation — all that is rendered meaningless.

Sacred Borrowing

Again, today everything borrowed since 2009 is considered wise “investment,” and thus pruning back any of the unnecessarily added spending is deemed heartless. Remember the logic of the debtor (I knew it well during the dark years of farming in the early 1980s when I saw the indebted everywhere): the debtor always asks himself why he should have to pay anything back, since his lenders still have more money than he. A Greece shrugs that even without their $180 billion paid back, Germans are still wealthier than Greeks; an Obama shrugs that even with higher taxes, the “wealthy” still have more than the recipients of federal largess.

If anyone thought that past Obama lamentations about the Supreme Court’s failure to force “redistributive change,” about the need to spread the wealth, about the notion that at some point we have made enough money were aberrant, then examine the most recent Obama toss off that he has hundreds of thousands in income “he doesn’t need” and thus doesn’t mind paying higher taxes on it (so should we all if we just had a government-paid-for house, car, plane, food, and expenses).

There Is a Pattern Here

Note well this pattern of suddenly turning to the neglected debt: Obama lectured for most of 2008 that “drill, baby, drill” was silly, given his belief that increased supply would only marginally affect then climbing prices, and his religion that high gas prices are good in that they make wind/solar subsidized energy more attractive, encourage less energy use and thus cool the planet, while favoring government mass transit rather than the mindless individual’s use of a private car. Then as reelection neared, he tapped the strategic petroleum reserve on the logic that while drilling more new oil does not lower prices, pumping previously drilled oil most surely does.

Note well that suddenly Obama called for withdrawal in Afghanistan, on the logic that, while a few months ago a surge, a new commander, and a sustainable commitment were vital to winning the “good war,” now, with reelection looming, it is time to start packing it in.

Aspirin for Cancer?

So what is the status of the debt limit crisis now? The annual deficit and the aggregate debts are so massive that all the talk of a few billion cuts here and there, or even a trillion or so, means little. To save us, we would have to slash two or three entire departments (e.g., perhaps energy, education, agriculture, etc.), end all agriculture subsidies, raise the retirement age, freeze cost of living raises for Social Security, clamp down on food stamp and entitlement abuses (almost 50 million now receive them), and do far, far more — while encouraging the private sector to drill, mine, grow food at unprecedented rates, as government trimmed regulations and revised the tax code to encourage wealth creation.

But it is far easier to create monsters and joust over the slices of a shrinking pie. So the current economic paralysis will persist as we continue demonizing the mythical “them” — until we stop acting like Greeks cursing better off Americans as if they were German bankers who are to be damned for their success.

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