Wednesday, September 07, 2011

Friedman said it plainly: Why our budget is in the red

Tom Friedman's op-ed piece today [New York Times "The Whole Truth and Nothing But"] says a number of things that need to be said even though in fact they are obvious. The politicians seem unable to say the obvious, the truth. But what I liked was the following succinct formulation of the problem.

Why has this been a lost decade? An answer can be found in one simple comparison: How Dwight Eisenhower and his successors used the cold war and how George W. Bush used 9/11. America had to face down the Russians in the cold war. America had to respond to 9/11 and the threat of Al Qaeda. But the critical difference between the two was this: Beginning with Eisenhower and continuing to some degree with every cold war president, we used the cold war and the Russian threat as a reason and motivator to do big, hard things together at home — to do nation-building in America. We used it to build the interstate highway system, put a man on the moon, push out the boundaries of science, teach new languages, maintain fiscal discipline and, when needed, raise taxes. We won the cold war with collective action.
George W. Bush did the opposite. He used 9/11 as an excuse to lower taxes, to start two wars that — for the first time in our history — were not paid for by tax increases, and to create a costly new entitlement in Medicare prescription drugs.

The reason politicians can get away with such much verbiage and so little information is that the public member is so short. There is no longer any mention that Bill Clinton left office with a budget surplus. The claim that both parties have contributed to the debt problem we have now is obvious but it conceals a critical reality: The administration of George W. Bush effective wiped out all surplus and -- according to a source quoted elsewhere on this page -- borrowed more money than all the presidents before him combined. {I have not checked this out; there should be a way to do it and I will try to get it done.]

Anyway, it's a reality that needs to be faced if wise decisions are now made in choosing the next body of leaders to take us out of this mess.

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