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Grow our way out of economic ruin?

post #1 of 4
Thread Starter 
I think the time has come for Americans to address what our leaders are failing to address. Fiscal responsibility.

There has been this idea over the years that when governments run deficits from time to time the debt can be easily managed because as a "hopeful" people we will simply grow our way out of "temporary" setbacks. Today I would propose that this notion is beyond flawed and go as far to say indeed it is a lie. There may have been a time when this idea could hold water but today this is no longer a reality that anyone can bank on.

The US economy is about to experience several setbacks which I believe are significant and potentially have the ability to set the stage for a violent downward spiral of economic deterioration.


At the state level many states are in over their heads with huge budget shortfalls and underfunded / unfunded pension liabilities which are not sustainable. This reality of budget shortfalls will translate into job losses. You can just imagine what this will do for the economy at large as more people find themselves without a job. More forclosures and softer levels of demand to support the economy at large. With more forclosures and softer damand for the economy at large by ever growing ranks of those unemployed municipal governments will experience a drop off in tax receipts both in terms of property tax and sales tax. This will lead to more budget shortfall and feed this ugly downward spiral even more.

A story to consider:
http://www.msnbc.msn.com/id/38072919...ew_york_times/

Add to this sad state of affairs the fact that many will find themselves without any further government support in the way of unemployment benefits. This has the possible result of further economic deterioration people who lived off of savings and unemployment have found themselves at the end of their cash. More homes forclosed. More downward pressure on property tax and sales tax revenues collected by municipal governments leading to more budget shortfalls and fallout thereof.

A story to consider:

http://www.marketwatch.com/story/exp...-02?link=kiosk

I could go on with other examples but I ask you this...

Do you see the US growing our way out of our problems?

I don't.

In fact I think we have deep rooted problems which everyone from the household level to the highest offices of government tend to sweep under the rug.

Gone are the notions of saving and thrift. Instead people are strung out on credit.

There is a sense of entitlement in terms of pension benefits which is a dinosaur of an idea in todays world.

I think Americans need to live within their means.

Work, save, put away for retirement.

Buy goods which are not made in slave shops across the globe.

Not outsource every American job.

Am I wrong?

Fellows
May the peace of the Lord be with you always

Share your smile, Have respect for others, and be loving to all peoples

Paul in Athens: Acts 17 : 16-34
Reply
May the peace of the Lord be with you always

Share your smile, Have respect for others, and be loving to all peoples

Paul in Athens: Acts 17 : 16-34
Reply
post #2 of 4
Quote:
Originally Posted by Fellowship View Post

...

I think Americans need to live within their means.

Work, save, put away for retirement.

...

Am I wrong?

You are not wrong (this time )
From out there on the moon, international politics look so petty. You want to grab a politician by the scruff of the neck and drag him a quarter of a million miles out and say, "Look at that!" -...
Reply
From out there on the moon, international politics look so petty. You want to grab a politician by the scruff of the neck and drag him a quarter of a million miles out and say, "Look at that!" -...
Reply
post #3 of 4
Thread Starter 
Quote:
Originally Posted by KingOfSomewhereHot View Post

You are not wrong (this time )

Ha!

This is an interesting read. I think what is said in this piece plays right into the economic situation we see playing out before us.



http://markettalk.newswires-americas.com/?p=12319

Fellows
May the peace of the Lord be with you always

Share your smile, Have respect for others, and be loving to all peoples

Paul in Athens: Acts 17 : 16-34
Reply
May the peace of the Lord be with you always

Share your smile, Have respect for others, and be loving to all peoples

Paul in Athens: Acts 17 : 16-34
Reply
post #4 of 4
We can't grow our way out of these problems. If the debt were to stay fixed and the US economy were to grow then we could grow out of it. BUT with all the new entitlements created recently there is no way for that to happen. On a local level the city and state politicians have bought so many union votes via lavish benefits that there is no way to grow out of that obligation.

Get ready for the pain.
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