A long time ago, when I first got into Management, I had a City Manager who liked to have meetings very month with all the managers in his territory. That made sense, and – to a degree – so did the steak lunches he ordered to go with the meetings. Frankly, it took a 4-hour session that was boring but very necessary, and gave us a reason to look forward to it. What I did not find reasonable, though, was his attitude to the expense.
‘Why not spend the money?’ he asked, ‘It’s not like we have to pay for it ourselves.’
That’s politics in a thought. The idea that you can do whatever you want, because someone else has to pay for it. And it’s been around for a long time, that idea. The American Revolution was fought, at least in part, because people here objected to having to pay for things they did not want and were never allowed to vote on.
I’m no Chicken Little. I’m no Forrest Gump, either. That is, I don’t figure things will work out fine just because someone promises it will, but I don’t buy into End-Of-the-World scare stories, either. There are certain natural laws about money and wealth, no matter your theory. The Communists and the Fascists found out the hard way you can’t create your own alternate reality, so you had better learn how things really work, or your plans will fall apart. At the same time, politicians have pretty much all figured out that there very few problems you can’t just pass off to someone else, especially unpopular decisions even if they are vital to the nation’s long-term safety and security.
It also does not help that the average elected official has, frankly, no business making decisions about the economy or business. This is because most politicians these days have learned only how to make speeches and campaign. They have NEVER owned a business, worked paycheck to paycheck or had to meet a payroll. Their idea of ‘accountability’ is finding something that sounds good in an interview or a speech, not doing the hard work. As a general rule, the more time an official can find to have ‘photo ops’, the less likely he or she has any idea how to really do what needs to be done. Sometimes a politician is competent enough to recognize he/she is a blithering idiot, and is responsible enough to get a staff who can get the job done. Other times the hairspray hero figures he/she can get by on looks and charm alone, and this kind of official can thoroughly screw up the works.
There’s 300 million people in the United States. And by most estimates, our economy can put out around Fourteen-point-Seven Trillion dollars of GDP a year, which works out to about forty-seven thousand dollars for every man, woman, and child in our country. Not $47k a family, but $47k a person. AVERAGE. That’s a lot of freaking money.
Bad news. Public Debt is about 59% of GDP. And about 12% of the population is officially in poverty. Also, we have about Fourteen Trillion dollars in external debt. Hey guess what, that works out to a little less than forty-seven thousand dollars for every man, woman, and child in our country. Not $47k a family, but $47k a person. AVERAGE. That’s a lot of freaking money.
Now, it so happens that I work in Credit. Commercial credit, looking at companies and telling folks whether the firm is stable, financially viable, and basically giving an analysis of its risk. The thing about Risk is that you have to accept some risk in any business transaction, but you look for deals that make sense. Governments are different from businesses in the sense that you have fewer partners to trade with, but are similar in that some countries are worth their risk more than others. The U.S. has a debt problem, but is still very attractive for some very good reasons. Put simply, the U.S. offers more opportunity at a lot less risk than many other countries, and with far more flexibility. That is why everyone buys U.S. Treasury notes and bonds, including governments – for all the noise and spin, the U.S. Government is as stable as they get, and even China and Iran find it worthwhile to invest in American securities (although, granted, only one of those two can do so on the open market). What that means s that the United States can get away with more stupid things than other countries, because our economy is sound enough to handle it. I mention this because it’s good news, and – the bad news – our politicians know this fact. Also, the U.S. is far from the only place with useless elected officials. My wife watches Asian news every day, and even without knowing much of the language I can tell that the news in China, Taipei, Japan, Korea and so on could reasonably be sub-titled ‘Stupid Things Done and Said by Local and National Celebrities and Politicians‘.
It’s a global phenomenon, FUBARity. As annoying as it is when our politicians screw things up, it’s important not to give too much credit to other nations and their own collection of well-dressed stooges.