Bonnie Alba
Real change: thrift and prudence
By Bonnie Alba
January 14, 2009

We Americans have come a long way from the Great Depression — not that we have learned from it. The Federal Reserve and U.S. Government have also not learned from history. They persist in following in the footsteps of a long line of public official "Fixers" while placing taxpayers and our nation in jeopardy for generations to come.

Americans have been ruled with expectations that our standards of living would continue to rise, jobs would always be plentiful and the world revolved around America the beautiful.

At the same time, our spending habits grew by leaps and bounds. We have been propelled into a spiral of overspending which, for some citizens, continues to this day. Instead of production as the primary measure of our economy, consumerism became almost the only measure against the export of industries-jobs and the imported glut of foreign goods.

For decades we have been united in consuming more than we produce as a nation. With a negative savings rate of -2 percent, some economic experts say we are only 90 days from bankruptcy at any given time.

It's a natural law; you can't both overspend and save at the same time. Other than depreciating 401k accounts, not much saving has occurred in American households. We've been overindulgent in our silly endeavor to fill our 2-car garages with mostly cheap, foreign Stuff, just so we can park our major expense in the driveway.

Many Americans are floating on a sea of debt. America's personal debt, excluding mortgages, is approaching $1 trillion. Personal and business bankruptcy filings are up and projected to increase even more in 2009 as job losses, business failures, mortgage foreclosures, inability to keep up with debt payments and other catastrophic financial events invade lifestyle cocoons.

The Good News is that pressure to spend is off the table for Americans — for now. Why? Because we're waking up to the fact that we do not have to follow the pied piper off the cliff. The Spending Spree is over.

Businesses and the government would like us to continue our decades-long spending habits. But Americans are busy adding two forgotten words to their vocabulary: Thrift and Prudence.

Thrift and Prudence are IN: Paying off debts and Saving for a rainy day are now being included in personal short-term and long-term budgets. Such are not things many American spenders have practiced or even thought about for decades.

The Bad News? If uncontrollable spending were a disease, then the federal government would be considered by experts for short- and long-term treatment.

I like the way Daily Reckoning's Bill Bonner stated it, "Looking at the essentials of the economic situation, we see it in 3D: A natural Deflation of asset prices in the financial world...leading to a natural Depression in the economic world...with an army of public officials Determined to turn things around." I would add those officials want to do the "unnatural."

The U.S. National Debt approaches $80 trillion (includes Social Security, Medicare and Medicaid future liabilities). Remember, the deficit is added to the National Debt at the fiscal year end, increasing that Debt. Two other items: The government only pays interest on the debt rarely paying on the principle; they start out fresh with a Zero deficit each year.

Deficits of the past eight years will look puny compared to the next ten years of $1 trillion annual deficits. This diseased uncontrollable-spending government ignores the U.S. Constitution and makes promises they can't possibly save America from itself. With nothing but monopoly play money.

While the government passes out play money to banks, businesses, and whoever else gets in line — including plastic surgeons and porno titans — ask yourselves the following question. Has Pres. Bush, Congress or Pres.-elect Obama put into motion anything that resembles cutting federal government operating costs? Cut Departments? Cut programs? Anything?

The majority of state governors are standing in line for a federal bailout (with strings), but not Governor Mark Sanford of South Carolina. I have nothing but admiration for Governor Sanford who has stood his ground against taking a federal bailout despite internal pressures from state legislators.

Play money is not going to save us. We must do it ourselves. What's missing? Outrage! Americans, our government is building the largest Bubble of all — DEBT. When will it pop?

If you are Outraged, inform your state and national representatives with the words: "Let the natural happen" and "Real Change: Thrift and Prudence."

© Bonnie Alba


The views expressed by RenewAmerica columnists are their own and do not necessarily reflect the position of RenewAmerica or its affiliates.
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Bonnie Alba

(Editor's note: Bonnie Alba passed away on February 12, 2017. You can read her obituary here.)

Bonnie Alba is a "politically incorrect" researcher-writer. Since 1995, her articles have appeared in California newspapers. Previously she served in various Department of Defense positions for over 16 years... (more)


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