It took me a long time to figure out that I know about as much as the next person - including politicians -about our economy. I know a little more or a little less than some.
After reading about the Greek economic implosion and its ensuing austerity policy, I remembered that the Greeks aren't the first to take such drastic measures: Ireland and Italy for instance, took the same steps last year. What austerity means to Greece is that programs, including its military (whatever that means) will be cut, and its retirement, pension-drawing age will be raised to 65 years old. Seems like too little too late, but at least it's a start.
Alternatives could be dire for the rest of Europe and the Euro. European nations would lose the money they loaned the Greek economy. Greek banks hold that debt, so their losses might need to be picked up by the government.
On the heals of Greece is media attention of our own debt ceiling looming large on the horizon. We're quickly reaching our credit limit and the ability to pay debts, while continuing to operate this behemoth government.
And with the deadline comes rather the predictable panic and posturing on Capital Hill. But that's not to say that there's no reason for panic. According to http://www.treasurydirect.gov/, our national credit debt in 2000 was 5,561,623,030,891.79. In September 2010 it was 13,623,030,891.79. I can't even conceive of that many numbers translating into dollars, and what's worse is that it's nearly tripled in 10 years.
I have a remarkable talent for boiling all sorts of things down to their simplest common denominator, I know. When there's no more money in my checking account, I stop writing checks. It's that simple. I know that it's not that simple in business and government, but we should start somewhere. Maybe we could use this to start really examining what austerity could mean for us.
I'm well versed in austerity. I've had to live on a shoestring budget so many times that I view credit cards as nothing more than a necessary evil, not as an easy means to a desired end. It's a hard lesson that the rest of the nation is learning as we tighten our belts, think long and hard before spending and really live within our means possibly for the first time in our lives - and for many it's incredibly hard because they're living within means dictated by government benefits: food stamps, unemployment benefits, medicaid.
Austerity could mean that we finally start taking a look at what some of those fabulous programs and benefits developed over the years by our fabulous government really costs us, and as importantly, whether they even work efficiently. Maybe it's time to either kill them, mothball them, or give them to private enterprise. All we have to do is look at our educational system and neglected infrastructure to know that things aren't as they should be. What's ludicrous to me is that, considering its stellar track record, this government proposes - even passed - more government-run programs like health care. No other government on earth right now is expanding. Shouldn't we take our cue from that?
Instead of taking a look at its own budget the way we have all had to do, part of Congress wants to raise the ceiling to squeak by without fixing anything. And yes, I know even if they did look at budget cuts like never before, nothing would be fixed in time for the August 2nd deadline. But it's got to start somewhere. By all means, raise the ceiling to forestall default and global financial chaos, do whatever it takes. But then get off your complacent asses and finally do something to fix this mess - or messes.
I probably haven't read enough to know the mechanics of actually raising our debt ceiling, but by whose authority do we do this anyway? Do I get to tell Discover card that I've reached my limit, and by God, if they don't raise my debt ceiling I won't be able to pay? Exactly how does this work?
As of yesterday, President Obama began threatening that if the credit ceiling wasn't raised, Social Security checks may not be mailed on August 3. This from the man who campaigned on reducing the debt by half by some distant date when he wouldn't be in office any longer.
Wait a minute. I, along with generations of working people who have put money into this program have always been assured of one thing: Social Security, despite decades-long threats of extinction, has always been sacrosanct. Now, what you're telling me is that you - the U.S. Government - can not be trusted with my money. If businesses were managed as badly as our government, they'd have failed. The government has mismanaged our money so badly, that consequences can very well be as bad as the investment banking system in this country. And many of them were brought up on criminal charges. Does anything more need to be said?
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