As a parent with two kids, I understand equality. Each child is unique but our goal and challenge is to treat each child with an equivalent expression of love. This takes on various aspects including the economic arena. College education is the classic financial challenge in a family. We want the best for both children but one will finish college and the other won’t. Economic inequality ensues. How do you help the child that did not complete college and maintain some level of equivalency?
Greece is in trouble. Their socialist spending patterns causing a less motivated population to “coast” through life is now coming back to haunt them. On the other side, the Germans have sacrificed and are extremely productive. The Germans are expected to bail out the “slothful” nation of Greece and they are not happy about it. Why rescue a nation who will simply continue to do the same thing that got them into trouble in the first place?
California, New York, and Michigan are in similar financial straits. For those living in other states, we have known for some time that California’s economy was somewhat of a fairy tale. Stories of how the housing costs were 3 to 10 times the cost of housing compared to the heartland caused many of us to wonder how long this disparity could continue.
In the 1980’s, the Southwest went through a boom and a bust because of energy prices. Housing prices dropped 45% during this period. Penn Square Bank went from a sleepy shopping mall bank to a major energy lender and took down a few financial center banks when the energy industry went bust. The Federal Government decided to make the region pay for its mistakes. There was no bailout money for banks in the area nor was there any assistance for businesses. We simply had to survive the economic bust as best we could. All of the otherwise incompetent bankers and businessmen were sifted out of the management arena and they went back to their previous job classifications. During the boom, it was like the Wild West for energy companies.
Now the shoe is on the other foot. People from states who lived within their means will be expected to bailout the states who have been riding high in the economy over the last 20 years. Oklahoma’s constitution requires a balanced budget and this prevents lawmakers from spending money they don’t have. Sure it is painful when there is a drop in revenue but we don’t delay the pain in hope of a better day. Delaying the inevitable only creates a monster. There’s an old saying: “Take you pain early and there will be less pain!”
Mankind has been so focused on “things” and entertainment, they have failed to understand financial accountability. The Great Depression guided our parents into a “saving” mentality and they took nothing for granted. If you don’t have the cash, you don’t buy it. We were a nation of savers. Now, we are a nation of debtors. Who do we owe? Other countries. When will we pay off our debt? No time soon. This prevailing attitude has dug us into an insurmountable hole and will require of us tremendous pain. The states will fend for themselves and there will be many battles with the Federal Government and its attempt to make states pay for others’ poor fiscal policy. Voters will vote their pocketbooks and remove those who attempt to saddle them with unfair tax burdens. Money spent on excessive entertainment is now a memory. The big boy toys are now tagged for the next garage sale. Was mortgaging our future worth the temporary pleasure? Repent!