Debt, Deficit, Death of America
One Dead Canary Coming Up!
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A few minutes past midnight on Monday, January 21st, 2013, someone will give birth to the day’s first American baby. With any luck, that baby will have become the first American to see his first light of day in a post-Obama world. That’s the good news. Unfortunately, the celebration of that good fortune will have to wait a while. For there is also some bad news—some really bad, you’d-better-sit-down-for-this, maybe-you’d-like-to-reconsider-this-whole-being-born-thing kind of news: That baby owes $185,000. Before interest. And that figure, even if the baby is born under a most propitious star, will grow by $5,000 per year, at least until he, along with the other babies born that day, is old enough to rise up and take action to stop the avalanche.
Why $185,000? That is the share of America’s combined debt and unfunded liabilities (minus federal assets) that will rest on the head of each individual citizen as of next January. And remember that each of this infant’s parents, grandparents and siblings will have his or her own $185,000 sinkhole to deal with, so there’s not much hope that Dad will come through with a little extra allowance to help out; he’ll have his own problems.
Why the $5000 per year increase? That is the per capita breakdown of a $1.5 trillion deficit. If you would prefer to be an optimist, and assume that the next president and congress will work heroically to achieve a half-trillion dollar cut in future deficits, then perhaps you can cheer yourself with the thought that in that case the annual increase in our baby’s personal share of America’s doomsday machine will be a mere $3,200. That’s 213 Walmart birthday cakes the little tyke must give to Uncle Sam each year—just to avoid deepening his private abyss any further. Better than the 333 cakes he’d be donating to break even on Obama-sized deficits, don’t you think? Won’t you be happy you voted Republican?
Of course, the numbers I have cited—$185,000 in total, plus $3,200 per year added to that—are mere flights of Pollyanna. Now dig out your abacus, and start factoring in the annual interest on the $51,000 portion of his total obligation that consists of his share of the national debt. In 2011, the total interest on the debt was almost half a trillion dollars—the fifth largest item in the federal budget. If interest rates should rise, even by a small amount, all bets would be off. For example, the per capita share of that debt, at the current 3% rate, was $1,455 in 2011. At a 4% rate, assuming the $16 trillion debt that will be in play as of our baby’s date of birth, the per capita share would be $2,051 annually. At 5% interest, it would be $2564. And remember, that is just the interest due on the $51,000 principle, which in turn is just a fraction of the total $185,000 anchor tied to the little cherub’s ankle.
And of course we must not neglect to account for inflation; for the possibility that deficit spending will actually grow in the coming years, rather than shrink drastically in the manner I have implausibly projected; for the short term fiscal effects of an international crisis requiring large-scale American mobilization at any point in this child’s lifetime; or for progressive taxation, which, on the current model, means that if our baby should happen to become a productive member of society, his share of hell will be much larger than the equal $185,000 portion I have given him.
In short, to say that the first post-Obama American will be presented, by his nation, with a $185,000 reverse trust fund, is absurdly wishful thinking. And remember the key element in this scenario: Our baby’s birthday burden will not shrink over time—quite the contrary.
People often make the point, on this issue, that a private family could never live this irresponsibly. Let’s look at that idea for a moment. When families assume a huge debt—whether to buy a home, to renovate that home, to buy a car, to start a business, or some combination of these—the terms on which they assume it are based loosely on the premise that the debt must be repaid within the lifetime of the person signing the contract. If it is not repaid within that lifetime, then the responsibility falls upon the borrower’s survivors.
What would we think of a man who incurs an unreasonable amount of debt, and who, when confronted with the danger to which he is exposing his family, says, “My children will deal with it”? Naturally, we would regard him as lacking the judgment and character required of the head of a household. Using this reasoning, it is common to say that the government ought to be judged on the same principle, and damned as irresponsible and without character for saddling future citizens with the price of today’s desires. This judgment is too easy—buck-passing is always too easy.
Today’s political class believes with perfect certainty that the way to electoral success, and hence to the perpetuation of its stranglehold on the nation’s resources and law-making apparatus, is to convince voters that they need something, and then to promise to satisfy that need. These people are perfectly certain of this method for a good reason: 80 years of relying on this method has produced an almost uninterrupted string of successes—where success is measured in increasing governmental authority, and decreasing individual liberty. The vast majority of voters, over the entirety of that 80-year span, have voted consistently for candidates who operated according to that method.
And the self-justifying objection that one must vote for the best of the candidates one is presented with will not do. In America, the candidates one is presented with are selected through a long and complex vetting process. Objecting, for example, that Obama “came from nowhere” is beside the point. Had a majority of voters not been inclined to prefer politics practised according to the “need-satisfying” method, a candidate who arose “from nowhere” making such promises would just as quickly be returned to nowhere. Likewise for a presidential candidate who—at a moment defined by the government’s attempt to wrest control of the citizens’ bodily health and survival from their own hands—has advocated precisely such an outrage in his own state.
Burying oneself in debt, taking on a lifetime’s unnecessary burden, risking the unloading of such a burden onto one’s children, all in the name of getting things that one desires but which one cannot actually afford (i.e. which one has not yet earned)—these are not, first and foremost, the sins of government. They are the weaknesses of generations of citizens. Living in this way is self-reinforcing: Convincing oneself that one “owns” something for which one is in hawk up to one’s eyeballs is now considered as American as apple pie. It is unpatriotic not to live beyond one’s means.
The American spirit used to entail a desire to have more than one has now, and a corresponding willingness to dirty one’s hands in the effort to realize that desire. Increasingly, this spirit has been transformed into a desire to have more than one has now, and a corresponding sense that one ought to be able to have it—now.
The mentality that made Fannie Mae and Freddie Mac possible—the mentality that is shared by Democrats and Republicans alike, that was espoused by George W. Bush, and that has recently been endorsed by Newt Gingrich—is the idea that home ownership is a proper societal goal. In other words, the principle involved here is that government ought to be in the business of providing, or encouraging, means of ensuring that people—more people, perhaps all people—can own something that many of them simply have not earned the means to buy.
By espousing such a principle as a motive force at a societal level, leaders promote exactly the opposite of what they are ostensibly trying to encourage. They promote an entitlement mentality, with its concomitant inclination to blame someone when one does not get that to which one feels entitled.
In Europe, and throughout most of the so-called civilized world, the entitlement mentality is the default position
In Europe, and throughout most of the so-called civilized world, the entitlement mentality is the default position, as collectivism in ethics, and state-controlled economies in historical practice, leave most citizens with no clear sense or understanding of how else things might be done. In America, which has a grand history of revealing just how successfully one’s goals can be achieved—and new, higher goals conceived—when citizens are left responsible for the provision of their own material well-being, the morally shriveling sense of entitlement does not come naturally. It is profoundly un-American.
In America, then, the entitlement mentality develops differently. By distorting the American Dream to mean winning the brass ring of results without need of actual achievement, American Idol as opposed to Louis Armstrong, a huge home without having to consider one’s capacity to pay for it—in short, happiness without the pursuit of happiness—Republican voices are just as guilty as Democratic ones in the real crime of the century: the slow destruction of the emotional foundation of moral life, which is the feeling that something worth having is worth waiting for.
Immanuel Kant argues that the earliest human morality arose out of a pre-moral discovery, namely the special pleasure of delayed gratification. From this feeling, which gives rise to the civilizing joy of anticipation, men develop the sense of self-restraint. From here, adult morality blossoms, with its understanding that living well is less a matter of knowing what one desires than of knowing what one ought not to do to achieve one’s desires—i.e. moderation.
This humanizing process, as is shown by the recent devolution of Western civilization, can be reversed. Discourage moderation, thereby promoting lack of restraint; in the absence of restraint, anticipation brings no joy, only the pain of “denying yourself”; thus, delayed gratification becomes the essence of unhappiness; at last, we are back to the pre-moral position—I want it, I should have it, give it to me—which is the very definition of the uncivilized life. A life unworthy of man, in any meaningful sense of that word.
This is the American form of the entitlement mentality which has stealthily crept into the nation’s heart. Once firmly entrenched there, like a drug addiction, it will be extraordinarily difficult to overcome.
And this brings us back to our baby. People like to say that no family would borrow itself into irredeemable debt like the federal government. And yet who borrowed the nation into that debt? Was it not, ultimately, the citizens of multiple generations who conveniently refused to see the obvious, voted for congressmen who promised to bring home federal money to their state, and voted for presidents who proposed grand schemes for bringing about desirable outcomes—for the voters of that generation—without considering how these desirable outcomes might affect future generations? Today’s Washington establishment is a seemingly intractable force; the operative word is “seemingly.” That establishment is the direct result of the voluntary electoral decisions of tens of millions of individual citizens, all of them with God-given free will, and the rational capacity to exercise the most basic form of moral discernment.
As for the idea that private citizens generally do not incur a debt that cannot be repaid in their lifetimes, consider this: A private citizen knows that, all things being equal, he can count on seventy years or more on this planet. Thus he can plan his debt with that time frame in mind, risking too much in the name of immediate gratification, but always telling himself he has it under control.
When it comes to the collective debt incurred by millions, the situation is more nebulous. What is the lifespan of the nation? For those lacking the historical sense—that is, the feeling of being part of a continuum stretching back and forward beyond their own lives—the national lifespan is so inconceivable as to seem unlimited. Hence there is no preconceived deadline by which the debt must be repaid. Therefore, the foolish risks modern men take with their own lives and families are extended to an imaginary infinity in the case of their nation. The peculiarly modern, and yet morally prehistoric, weakness—the need for immediate gratification—literally knows no bounds in the public realm.
That is why the numbers matter. Our hypothetical baby will not be hypothetical for long. Keep him in your sights at all times, as we move all too quickly into America’s treacherous future. That baby is your canary in the coal mine. His fate will be America’s. Perhaps that harsh reality can reignite the sense of national mortality—of ever-present mortal danger, in fact—that was so omnipresent to the nation’s Founders, and to its first several generations. And perhaps this sense of national mortality and fragility will force even those who want what they cannot afford to recognize that an amortization schedule, with a date of final payment in sight, is America’s only escape from a shameful and undignified death.
On January 21st, 2013, a baby will be born. If he is not stillborn, he will already have been blessed. His condition will unavoidably be poor throughout his life. Whether it improves slowly as he matures, or deteriorates unto premature death, will be determined, at kitchen tables and in voting booths, by the adult citizens of the United States of America. The operative word this time: “adult.”