A few years back I attended a presentation by David Walker, former Comptroller General of the United States. At the time Walker was becoming quite well known for making a frightening and compelling case as to why the United States needed to get its financial house in order. Like a rock band, Walker took his message on the road, across the United States, giving talks to anyone who would listen. In 2012, Sixty Minutes caught up to Walker and interviewed him. What he had to say, wasn’t easy to hear.
An interesting thing happened along the way. People started calling David Walker, “Dr. Doom.” And started tuning him out. No one talks much about the national debt and deficits anymore. Not Republicans. Not Democrats. Do you remember the last time you heard anything on the topic? It’s almost as if the topic were verboten.
Fast forward. I’m reading Debts and Deficits: They’re Unsustainable a piece by Bob Luddy on the American Spectator web site. Luddy a former Chairman of the Board of Directors of the Civitas Institute is also Founder and President of CaptiveAire Systems, the nations’ leading manufacturer of commercial kitchen ventilation systems.
In the article Luddy lays out the case why the United States must get its financial house in order. Sound familiar?
Remember this number: $21.5 trillion. That’s the total US debt; $21.5 trillion is a mind-numbing number. Such large numbers are difficult for most folks to get their arms around. Exactly how much is $21 trillion? This video helps to breakdown how much debt we really have.
Luddy’s diagnosis of our national problem – like David Walker’s — is spot on. The federal government and spending are the main problems. Luddy writes:
Federal deficits are the same as increasing your standard of living with credit cards. It is fun while it lasts, but it leads to bankruptcy.
Some of the worst outcomes from the reckless spending are as follows:
- The Social Security system is moving toward insolvency, which means the national retirement program will be at risk.
- Colleges and universities have increased tuition to unsustainable levels, trapping our youth with heavy debt, which adversely impacts family life.
- Social welfare spending in the trillions has undermined families and has not improved poverty. We now have an extreme poverty of skills and fewer stable families. Today’s poverty rate is about 15%, which is higher than in 1970.
- Forty years after the creation of the Department of Education, our K-12 schools have declined in quality. We have spent trillions of federal dollars on education to make it worse. K-12 is now a national disgrace.
The massive, regulating bureaucracy has reduced our GDP growth and suppressed entrepreneurial creativity, A.K.A. American Exceptionalism.
Fortunately, Luddy provides solutions to get our nation back on its way to financial health. It won’t be easy, but it’s possible.
When I finished reading the article, I felt strange – even angry. David Walker, Dr. Doom, came to mind. Why is no one talking about the debt? Most of the public and lawmakers simply don’t want to hear the message.
But there is hope. Thirty years ago, New Zealand found itself in a similar situation and took its medicine. Today that nation has one of the healthiest economies in the world. And more importantly, it has shown the path other nations must take.
At our own peril, for too long we’ve ignored this problem and find ourselves with more debt than ever. Now Bob Luddy is sounding a similar message.
Do we ever learn?