Column: Quick-fixes For Economy Will Win Votes But Solve Nothing
This story was written by Chase Cooper, Indiana Daily Student
When economist John Maynard Keynes, highly regarded among modern liberals, famously summarized the notion that its often better to improve immediate circumstances than to constantly plan for the future.
In the long run, he quipped, were all dead.
As it turns out, the long run might just be 2008.
Recently, economic and government leaders have been trying to figure out how to prevent the collapse of the entire U.S. financial system. Thats an amazing fact to contemplate. Were not talking about lipstick on pigs here. Were talking about a fundamental change in life as we know it.
How in the world did we get to this point? That answer is long and complicated, but the underlying problem is rooted in the desire to have stuff now and pay for it later. This problem is compounded by politicians who are all too eager to provide their constituents with instant gratification at all costs in exchange for votes.
The current financial crisis is primarily due to the fact that banks have been forced by law to grant home loans to people without the means to pay them back. This started during the Carter administration with the Community Reinvestment Act and was expanded during the Clinton years. These risky loans compiled and spread throughout the financial system, and as more and more loans went bad, things spiraled out of control.
In a desperate attempt to ward off doomsday, the Bush administration and Congress are working together (never a good sign) on a $700 billion bail-out deal. This might not be so bad if we werent nearly $10 trillion in debt, with larger deficits on the way.
Social Security is a ticking time bomb, and we have dozens of other massive spending programs for which we have no means to pay. Liberals want to provide universal health care with money we dont have. Now Democrats are working on a $50 billion stimulus package (yet another short-term solution that will cost us down the road), and Sen. Barack Obama wants to commit $845 billion over 13 years to the corrupt UN to fight poverty.
Where will it all end? The answer might not be pleasant.
Meanwhile, no one in Washington wants to take responsibility, and Senate Majority Leader Harry Reid weakly lamented that no one knows what to do.
I know what to do, Sen. Reid. We need to throw you and all your reckless, big-spending, vote-buying, live-for-the-moment politician and bureaucrat buddies from both parties out of Washington. We need to incentivize success, rather than subsidize failure. We need to restore the constitutional limitations on the federal government before we find ourselves in a state that we no longer recognize as the prosperous, free country weve come to love.
We can start by repealing the short-sighted Community Reinvestment Act and let people who cant afford houses (gasp!) rent an apartment until they can afford one.
Most of all, we need the leadership were not seeing from either major presidential candidate, which articulates the virtue of the market system and instills confidence in the American people.