The Wall Street Journal published an article by the above title today. Its author was South Carolina Governor Mark Sanford. Gov. Stanford presents an informed argument against the Congress’ bailout of Wall Street and cash strapped states. He asks and answers a number of questions that are worth considering.
One of his questions is: Who bails out the “bail-outor”? What he means is who will bailout the federal government. His answer is what we already know. The federal government does really have any money. All of the money it plans on using to “stabilize” banks, Wall Street firms, automakers, and states will all be borrowed against every Americans future income. The answer, therefore, is either no one because foreigners and their governments are also experiencing the same deepening economic recession.
Gov. Sanford makes a point all taxpayers must seriously consider. He wrote, “Already, our nation’s unfunded liabilities total $52 trillion — about $450,000 per household. There’s something very strange about issuing debt to solve a problem caused by too much debt.” (Emphasis added.)
All of the talk about balancing the federal budget is nothing but hot elite air. Not only will the feds not be able to balance their budget, but their huge bailout borrowing extravaganza will hurt fiscally responsible community banks and fiscally prudent states, according to Gov. Sanford. As he indicates, the bailout will only benefit the bad boys.
Democrats want to increase the national debt even more by expanding health care costs. Gov. Sanford informs us that Medicaid expenses have been increasing 9.5% a year for the past 10 years, which is unsustainable. Add universal health care costs to the bill and what is already unsustainable becomes a catastrophic economic problem. Who will pay for it? The largest group of taxpayers in America is the middle-income group.
President-elect Obama is being billed as the next FDR. That should cause great concern to all because FDR began the big borrowing-big government programs. FDR helped to prolong the economic crisis of the 1930s. FDR jumped into World War II in order to borrow…borrow…borrow America out of the great depression. WWII was legitimated borrowing huge sums of money to put Americans to work. Does did really work? Only temporarily. What I have been hearing from various economists and money market experts is that each economic crisis has been getting worse since FDR’s big borrowing bailout.
Another important question Gov. Sanford asks is: Isn’t government intervention supposed to be the last resort and come only when it can make a difference? As he notes, Congress committed $2.3 trillion as a first resort solution to improving our economy. Adding another $150 billion is like adding a twinkie to truckloads of sugar already dumped to sweeten a lake. It won’t make much difference except to the taxpayers who will have to repay the insane amount of debt.
Maybe that is why millions of Americans have little savings, no retirement, inadequate health care, and little economic future.
Looking at the issue as a head of state, Gov. Sanford counsels against states accepting a federal bailout of states. Instead of is his solution to states effects by the economic crisis:
[T]here is something Congress can do: free states from federal mandates. South Carolina will spend about $425 million next year meeting federal unfunded mandates. The increase in the minimum wage alone will cost the state $2.6 million and meeting Homeland Security’s REAL ID requirements will cost $8.9 million.
Here is the age-old wisdom of Constitutional government: Limited not only as to its powers but also to its spending, borrowing, and taxing.
Gov. Sanford apparently believes it is not too late for Americans to stop Congress from mortgaging our economic future with unsustainable debt to bailout Wall Street and states. Ohioans also may be able to stop Gov. Strickland and the Ohio legislators from the same.
You can contact Gov. Strickland by E-Mail, by fax at (614) 466-9354, by phone at (614) 466-3555, or by us mail at Governor’s Office, Riffe Center, 30th Floor, 77 South High Street, Columbus, OH 43215-6108.
To contact your elected Ohio legislators, go to the House of Representatives directory and to the Senate directory.
To contact your Congressional representatives, go to the House of Representatives directory and to the Senate directory or call the Capitol switchboard at (202) 224-3121 for Representatives and Senators.