Debt Matters: A Brief Manifesto against Obamanomics

"The rich rule over the poor, and the borrower is servant to the lender."

Proverbs 22:7

The title of this post is a little facetious, to be sure. Our massive government debt isn't the fault of just Obama, he's just the latest champion of obese government spending. I'm opposed to most of it really. I was opposed to the stimulus measures back last fall (see here and here), and so I'm no johnny-come-lately to the criticism of government spending. That 700 billion was spent in a jiffy and no one knows where it went. Then Obama passed another "stimulus" measure that hasn't really stimulated (because it hasn't been spent yet), and yet the economy is beginning to recover on its own anyhow.

I'm no economist. I have an amatuer's interest, but I can't understand the complexities like an expert. And yet regulating money, in the end, is very simple. People should spend less than they make. And yes, governments should spend less than they make. The proverb above applies to every person and organization. The borrower is always servant to the lender.

While Lord Keynes may have taught, to some degree, that government spending can jolt an economy, the entire decade of the 30's should teach us otherwise. Most economists roundly agree that FDR's policies didn't bring us out of a depression, but rather that WWII did. And yet we're currently re-living the bogus thinking that a government can spend it's way out of an economic downturn. Two thoughts: we'll always have economic downturns, and the borrower is always servant to the lender. The money the government is spending is costing us dearly in much more important capital. Don't believe me? Listen to the words of Cokie Roberts, no friend to Libertarians or Conservatives, from Sunday on This Week with George Stephanapoulos:

"We can't put the type of pressure on China that we would like to put on China to cooperate with us in terms of North Korea or Darfur or other types of places because they own so much of our debt, and we are not in a position to pressure them because ...we are beholden to them as long as we are driving up this kind of debt."

I know economics are complex, but this simple truth is at work on a geopolitical scale. We can't exercise what little moral authority we have because we are in debt. We want new cars w/ "cash for clunkers," yet we're compromising our ability to weild international influence. Just because we want stuff and we want people to have jobs that will sell stuff. Debt is a more insidious, but more long term destructive power to our national strength. But it's even more destructive to our national consciousness and our national morality. The borrower is servant to the lender.