His column today, "No new promises, please," has a message that is relevant to all levels of government as he talks about an 'unsustainable fiscal path':
"We are on this path because past elected officials made unsustainable benefit promises and enshrined them in law. In some cases they paid for those promises in the short run. In all cases they created programs that would grow more generous over time.
Those past elected officials enjoyed the political benefits of creating a new promise, and they shifted the burden of paying for these promises onto their successors and onto future generations of citizens.
... we are those future generations. The bill is coming due. The gap between future spending and taxes is the most important economic problem America faces. If we don’t fix it, we’re screwed."
Sound familiar? It should - this is what Toledo has done.
Even last year, City Council voted in favor of union contracts that provided six months of concessions, but went right back to the old terms as of the January. They got a six-month delay in addressing the city's deficit - but they didn't change the fact that the deficit still had to be addressed.
Of course, waiting that time also made the issue worse.
Governments cannot continue to grow and expand. I know that employees always want pay increases and don't want to have any cuts in their benefits. But government cannot be immune to what the market is doing - especially when those of us in the market are the ones having to foot the bill. We can't go to our employer and say 'give me more money.' (Well, we can but it won't result in action for the vast majority of us.)
Politicians and elected officials need to understand that the well has run dry and cuts are the only way they're going to be able to regain control of their budgets.
I know there will be people complaining because they're no longer getting their little piece of the pie. But they probably shouldn't have had any of it to begin with, and they're going to have to make do just like the rest of us.
Government needs to shrink back to the point where the expenses stop exceeding the income. And it needs to stop thinking it can always get more income - because it can't, as politicians are learning the hard way.
2 comments:
Your post caused me to think that the term "Political Leader" has become and is an "Oxymoron."
What we are seeing is the bursting of the "political bubble," which is much the same as we saw in the bursting of the "internet bubble" and the "housing bubble." In each of the bubbles, we had fundamental structural changes to a level that the market deemed as financially logical and sustainable. It was the laws of economics that won out. They always will...just like gravity, but it's in the form of financial gravity.
So whether the current crop of politicians had anything to do with creating these bubbles, it's irrelevant. They must face up to the fact that fundamental structural changes must be made to government operations both in financial and functional ways. They cannot assume that things will improve within a short period of time and we can push it off until the next budget period.
For the politicians, wishful thinking and flowery speeches are not going to feed the bulldog. Politicians will no longer be able to hide. Either they will do what is right, necessary and obvious or they will find themselves replaced by people that will.
But it's not all gloom and doom. We should be heartened to know that as painful as it will be, in the end it is necessary and will benefit our society.
I agree with you, but I see a few problems ahead.
Politicians and elected officials need to understand that the well has run dry and cuts are the only way they're going to be able to regain control of their budgets.
The trouble is that the well hasn't run dry. Politicos raise taxes and the IRS removes money from my paycheck before I get a chance to grab it and pay my bills. Unemployment is high and getting higher, but no matter as unemployment benefits are taxed just like regular earned income. Until the money stops flowing entirely, the Politicos don't need to realize anything except the popularity polls for the next election.
I know there will be people complaining because they're no longer getting their little piece of the pie. But they probably shouldn't have had any of it to begin with, and they're going to have to make do just like the rest of us.
You shouldn't have started feeding the squirrels, but you did. If you stop feeding them, they'll start gnawing away at your roof. The trouble isn't the little piece of the pie that you gave; the trouble is that the pie disappeared immediately and the hungry bureaucracy demanded more, much more. So, a little more didn't seem so bad - did it? The consumers of the pie will never, ever be satisfied. Ever. The politicos know this, but that doesn't seem to slow most of them down. They just keep feeding the bureaucracy, which continues to grow. Why would they do such a thing? Because it increases their chances of re-election.
Government needs to shrink back to the point where the expenses stop exceeding the income. And it needs to stop thinking it can always get more income - because it can't, as politicians are learning the hard way.
Sure - so long as government shrinks the right way. That 'way' is going to be redefined for each government employee you talk to.
I have concluded that shrinking the government is never going to happen. All that can be done is to slow the growth. Even if the federal government goes bankrupt, the size won't shrink. Instead, the federal government will become larger to deal with the bankruptcy.
Ideally, the role of government would be carefully defined in, say, 100 words or less. Everything that did not directly apply to that goal would be dismantled. After that, maybe things would get a little better.
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