With all the occupy Wall Street news and movement going on right now, I think we need to reflect on what the average household debt has looked like over the years. While we are in a culture of finding others to blame, it is important to realize we also have ourselves to blame. Since the 2000 house hold debt as a percent of disposable income has held at a very high level. Below is a great graph to understand this issue.
The U.S. has had the idea of a debt ceiling for a long time.
Through the 40’s, 50’s, 60’s, 70’s and 80’s the debt ceiling was raised but only by small amounts. Why in the late 80’s and through today has the debt limit been raised so fast? Yes, we have had wars to fund and recession we have tried to spend our way out of, but that does not tell the story of the past 30 years. Surely, we have not needed 20-30 years of record spending. Has the government promised us more then they can deliver in order to get elected?
We all like our promises. We like politicians who make promises to us and we elect them, even when those promises just cost the country more and more.
For years some politicians and others have warned us about our entitlement spending. Do they really know what they are talking about? 
Are entitlements really a root cause of our spending issues? To the right is a chart of our government expenditures since 1950. The chart shows what, I am sure you have seen a lot of over the past few weeks. While this shows we have a problem it does not help us understand how to solve the issue. Let’s take this this chart down one more level, and look at government expenditures by major 
category. In this chart you can see that entitlement spending in social security and Medicare having been spiking. Nearly headed straight up. Defense spending also has a very steep trend.
I am sure you have heard both Democrats and Republicans blame either entitlements or defense spending for our current issues. While it is a hard message to hear, we obviously cannot continue this spending trend. If we continue to elect only people who say what we want to hear how can we expect this to change. Politicians tell us they will pay for this or buy us that because it helps them get elected. Have we become like spoiled children clinging to which ever parent will buy us the most?
We have to demand more from our leaders? We have to demand more from ourselves. We must be willing to make hard choices and those hard choices cannot be to have the rich pay more taxes. As you can see from those charts, increased revenue cannot keep up with these trend lines without sucking it all dry.
The following video from Bankrupting America does a great job and explaining all of this. May we all, democrat, republican, independent demand more.
It’s hard to believe that only a few generations ago the United States of America was the largest creditor nation in the world and today we have become the largest debtor nation in the world. How could we be so careless and to put at jeopardy our future and our children's future and our grandchildren's future and beyond. It’s immoral what we have done.
Imagine a friend who calls you up and says, “I have a financial problem. I make $58,000 a year. I have been spending about $75,000 a year and I have found myself with $327,000 in credit card debt. But I think I have a solution, spend less! From now on I am only going to spend about $72,000 a year.” (adapted from the Dave Ramsey show)
How do you feel about your friend's plan to get back to financial stability? You should feel sick and want to slap your friend in the face. Well folks, this is exactly the situation going on in Washington. The numbers are different but the ratios are the same. This friend is the government of the United States of America. What are you going to say to your friend?
A recent study done by the American Revolution Center found that 83% of American’s could not score higher then 44% on a test about the American revolution. That is a failing grade for the majority of all Americans! This should not be an area we are willing to accept a bell curve grade on. Is this a test you could pass? Is this a test people even care if they pass anymore?
“In general, the Survey questions varied in difficulty, but most were designed to assess basic knowledge of the American Revolution and its enduring legacy. At the end of the survey, several contemporary questions were asked in an attempt to understand the magnitude of difference between knowledge of popular culture and knowledge of our nation’s founding history and principles.”
One of the most interesting points called out by this study is that 90% of American’s believe it is important for us to know the history and founding principle of the American revolution, yet almost all of us cannot pass a test on what those principles and history are.
“Sixty percent of Americans could correctly identify the number of children in reality-TV show couple Jon and Kate Gosselin’s household (eight), but more than one-third did not know the century in which the American Revolution took place.
Many more Americans knew that entertainer Michael Jackson sang “Beat It” and “Billie Jean” than knew that the Bill of Rights is part of the United States Constitution.”
Dr. Bruce Cole, President and CEO of American Revolution Center, writes a stirring message at the beginning of the paper I encourage you to read. How can we expect to control our government when we don’t understand our government? This was one of the cornerstones our government was created for. A government by the people for the people.
“If a nation expects to be ignorant and free, it expects what never was and never will be.” - Thomas Jefferson
The study has a number of shocking revelations in it. It revels that not only do we not understand the revolution but half the people surveyed did not even know the chronological order in which it took place (many listed the Civil War, Emancipation Proclamation or War of 1812 as happening before the revolution).
“More than 50 percent of Americans wrongly attributed the quote “From each according to his ability, to each according to his needs” to either George Washington, Thomas Paine, or President Barack Obama, when it is in fact a quote from Karl Marx, author of The Communist Manifesto.”
How can we seriously expect Americans to elect good leaders in their country when they attribute a quote by one of the founders of communism to one of the American Presidents? This combined with the other finding that 11% of Americans would give themselves an A for their knowledge of the American Revolution and 3 out of 4 would give themselves a B or C, is a truly scary proposition for this country.
How can we as a nation expect to elect qualified and deserving people into office if we don’t really understand the founding principles of this nation? How can we elect a leader of a free nation when 50% of us think a founding principle of communism sounds like something an American president would say?
The PDF for this study includes a lot of very interesting statistics about different questions and how American’s value different rights. In reviewing all the results a few things stood out to me. When asked how important a given right is Democrats are almost always lower in saying that right is essential or important, except for when it comes to the right of privacy in which Democrats are a little higher. Yet, on the right not to have your property searched and seized Republicans are higher (I would really like to talk to these people who say “not that important”).
To the credits of Americans, when asked after the survey if they would like to learn more about the American Revolution most said yes (maroon is yes and turquoise is no). It is interesting to see what groups had the lowest “yes” responses though.
It is very important that we understand the history of this nation and the principles upon which it was founded. May this be a wake up call to all of us. May we understand these principles and may we demand more clarity out of our government to make sure our elected officials are working to support these principles.
Mitch McConnell’s proposal to give away congress’s authority to raise the debt limit to the President is childish, and at a minimum borderline unconstitutional if not outright so. The founding fathers setup a divided federal government to enforce checks and balances and to slow down the process by which the government gets things done. They feared unilateral power in one branch of government. One branch of government cannot and should not delegate away their power to another branch – it is blatantly un-American according to the constitution.
The federal budget is loaded with wasteful spending. Anyone who denies this reality is simply not serious or honest. Just like every American family that has to sit down at the table and figure out where their money is going and cancel the Xbox Live subscription, or the Netflix subscription, or sell the ATVs in order to pay for the mortgage and purchase groceries when the paycheck simply doesn’t cover everything, our elected officials should be serious about doing the same. Where are the grownups willing to go through the budget and cut? Who is willing to reform or disband programs that cannot continue without jeopardizing our solvency? Yes, some people will be impacted negatively but that is the price we have to pay to get healthy again.
When it was discovered that my new born daughter was sick in a way that threatened her life and it would required a bone marrow biopsy, a liver biopsy, countless pin pricks to take blood samples, and ultimately chemotherapy to get her well we didn’t hesitate. It took 9 months of struggle but now at age 6 she has been healthy and a light in our life for over 5 years.
America is ours to lose. If we don’t demand our politicians act like adults then as the country gets sicker we have no one to blame but ourselves. Toss out the professional politicians who are blinded by their re-election fund raising and replace them with normal Americans that know how to do the hard work of fixing real problems.
