Monday, March 8, 2010

Should Politicians be Deciding our Fiscal Policies?

It seems that the hurricane called the global recession is starting to lose steam and peter out. But, if you follow global weather patterns, you see that there are always after effects, residual shocks, smaller storms, etc. In short, no disaster seems to operate independently. There is always cause and effect.

So what caused this recession? After all, if you can isolate the cause of a disease, you can help prevent its recurrence. The near collapse of the US economy was frightening. The devastation caused by it harmed countless individuals and businesses alike. Many have not yet recovered. Who is to blame?

It's easy to say that the mega-bonuses within the nation's financial industry were the problem. However inappropriate these bonuses may have been (and continue to be), they were not, and are not, the root of evil. No, when all is said and done, the root of economic evil is lousy government policy. Government leaders, and their script writers, are excellent at describing the ill-gotten gains of the private sector. It is quite easy to divert public attention from the real problems at hand by placing blame at the markets whose goal is to earn money. How many millions of American homes are now in foreclosure due to a mortgage system that was manipulated by US government policy, rather than operated by the modes of free economy?

Imagine, for a moment, that the US government operated along the lines of a major for-profit corporation. The Senate and Congress would be the Boards of Directors and/or shareholders. The CEO and his staff would have to justify their fiscal policies and operate the business in such a way to please the directors and shareholders. After all, the bottom line is what truly matters. Sounds absurd, of course. On the other hand, can one imagine a mega-corporation continuing to function while juggling an operating debt of more than $1 trillion? Of course not. At the minimum, some change in fiscal policy may be deemed necessary.

But, governments continue to operate based on political need. Business will adjust to the times and weather storms as necessary. With a little luck and hard work from non-government entities, society will persevere economically and overcome the mistakes of its political leaders. If we want to avoid another recession, it's truly time that politicians stick to their business but leave the money matters to the professionals.

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1 comment:

  1. If our government were forced to operate as a business we wouldn't have half the problems we do, but they run rampant wasting money and not being accountable for over spending. If the persons responsible for ridiculous expenses and bad business decisions were held personally accountable for the over spending I bet the budgets and bank accounts would be balanced in record time. Instead we just get hit with more taxes and fees to refill the coffers so the abuse can continue. I know my business and myself are held responsible and so should the abusers in our government be. Lets start with abolishing all the double dipping in the pension fund. You get to collect one pension and guess what you don't get to collect it till you are of age and retired like everyone else....

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