Are We Ready to Handle the Truth?
Here’s a proposition for all you historians and economists to consider: No country has ever failed because it was too rich and prosperous.
There is a corollary: All countries whose expenditures have become insupportable through some combination of taxation and borrowing have eventually failed. By fail, I mean undergone a radical transformation of government and an extended period of social and economic upheaval, likely including depression.
Recent elections in Europe proved, if there was any doubt remaining, that neither European voters nor their politicians are prepared to give up on the promise of a socialist utopia. Unfortunately, the countries that have elected leaders making the most promises are the same ones that can least afford those promises. Their economies are faltering, taxes collected are declining, and the bond markets are squeezing their borrowing capacities further.
Since both economies and populations began booming with the Industrial Revolution, social and infrastructure demands have been piled on military ones, as well as the apparently limitless ability of bureaucracy to expand itself, abetted by special interests overburdened with money. These demands are what have stretched governments around the world to the breaking point and beyond.
Greece is the current, but certainly not the last, poster child for the next phase of — what? What happens when the money runs out?
A discontented citizenry seems to be an early symptom. The Greeks, for example, have been rioting in the streets and burning things down, possibly in the belief that rebuilding them will spur a construction boom.
Then comes inflation. In ancient times, rulers clipped chunks out of gold or silver coins. These days, central banks churn out more paper. Greece and other struggling European countries are restrained by their common currency. Can the euro survive?
Next comes a reduced standard of living, as wages lose purchasing power and imports fall off because a depreciated currency won’t buy much.
Pretty soon rioting becomes a recreational activity, because there are no other ones available and people have a lot of time on their hands.
This is about where that radical transformation of government occurs.
It is possible to have a less contentious transformation, if only by degree. Consider Wisconsin, a state that could provide a template for changing governance. All it required was a politician who actually meant what he said, 18 months of civil disturbance, and the most expensive election in the state’s history. The result left a lot of government workers unhappy and a balanced budget. Get used to it.
Something like Wisconsin’s tough medicine is the only viable alternative to the unpredictable unwinding of governments around the world, including ours. Wisconsin’s governor, Scott Walker, has become a piñata for the left and a hero of the right. He is most likely neither. He is an apparently prickly individual who was elected on a platform of controlling the state budget, and actually set out to do so. Wisconsin’s citizenry was sufficiently fed up with the status quo to elect him and then confirm him.
Translating a single state’s action to the international stage will be extremely difficult, and some European nations may be just too far gone; but ask yourself:
What would happen if Mitt Romney, or, for that matter, Barack Obama, put forth concrete proposals to reform entitlements, the military and the tax code and to bring the federal behemoth to heel – not next term, not during the lame duck session of Congress, but right now? What if these proposals were made the heart of the presidential campaign, as they should be?
Do you think that, just maybe, all of America is ready to handle the truth, or is Wisconsin an aberration?
sbFred Wolferman lives in Southern Pines. Contact him by email at fwolferman@
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