Priorities

As California searches the credit markets for $7 billion in interim loans and increases its budget deficits way beyond any state deficits in history, Virginia and Maryland join a host of additional states in “being forced” to trim educational budgets, and as most states and the federal government have recognized that they will lose many billions of dollars in lost property taxes from reduced housing values, foreclosures and lower revenues from all forms of income and capital gain taxes – something’s gotta give.

Watching the Presidential debates, it’s hard to understand exactly what our priority spending ability will actually be in the next fiscal year – maybe it’s because we really don’t know. We have massive interest obligations to nations around the world with a $10 trillion (and growing) national debt. We could default, but then we could never have another deficit again (no one would take our debt), and we would see some dumping of dollars in the international market that would create inflation at a level we have never seen before (think $20 Burger King burgers). Maybe the silver lining of the government’s taking stakes in the institutions they bail out will produce unexpected longer term values.

But we have “now” to deal with. And there is a little German word that we have borrowed that should be addressed as well: schadenfreude. It is the perverse delight in the misery of others – pretty much for the sake of watching suffering. It is often accompanied by a “savior” complex – to be the hero after you let the misery of others continue and step in with a magical solution well after you could have helped solve the problem. Why do I mention this here? Because politicians from both sides of the aisle often delight at the failures of their opposition, letting things get worse, not cooperating to help with solutions until they can appear as heroes before their constituency and replace the evil incumbents who failed so badly. For many, this is simply, “politics as usual.”

There’s a catch – if things get so bad that no one can fix them, if the misery factor extends to the vast majority of constituents of both parties, “politics as usual” can be fatal. I believe that we can repair this economy, restart our financial institutions and ignite our workforce, but it cannot be done with “politics as usual.” We need to understand what patches we need to get to a growth period, and what investments are absolutely necessary if we are indeed going to have growth sooner rather than later.

The patches are keeping people in jobs, keeping people in homes and supporting the institutions the enable both of the above. It looks like a bailout, but unless we waste the money on executive pay and perks, rewarding the idiots who got us here, it is actually a necessary investment – a repair to foundation of the house we are rebuilding.

But given the budget restraints of paying interest on national debt and the moral imperative of stopping genocide anywhere it occurs, we also have differentiate between (i) state and federal programs of limited value to Americans (money down the drain) versus (ii) governmental investments that make our economy more efficient (highways that work, dams that hold, levees that don't break costing us billions in emergency relief, bridges that do not fall – how we more goods and services from place to place, plus a more efficient use of energy – from buildings to cars), create a work force that can create more valuable products and services (clearly every form of education in the system), eliminate waste from the system (from pork barrel politics to reducing the $1,500-$2,000 of health care in every car we sell, stopping the drain on emergency medical services and focus on prevention, making sure Americans are healthy enough to fix the problem) and seeding invention and research that will create new jobs in the future – from new energy exploration and alternative energy creation, better batteries, better medical and biotech research, etc.

And that means we have to look at everything else with a big question mark. We're not going to win a civil war in a country where we are not even a party, and if we have to deploy military resources, let it be where it helps keep Americans safer or where we stop mass murder. While we should not kill our future by failing to invest in it, we likewise cannot kill our future by spending on failed policies (throwing good money after bad), failed bureaucracies and programs that having nothing to do with our future or our survival. Can America change its divisive ways and rally to rebuild our greatness? We must.

I’m Peter Dekom, and I approve this message.