Not long ago, I had a column that referenced unfounded fears that current budget deficits will lead to rampant inflation and a tanking economy.
At the time, such talk was treated as conventional wisdom by the major media outlets, and anyone who disagreed was blown off as being unreasonable and silly. As has been too often the case over the years, the ones considered outside the mainstream have been completely correct.
According to conventional wisdom, the federal government is borrowing and spending money so fast that inflation is just around the corner. In order to deal with this, we're told, we must do a number of things that involve cutting taxes, cutting spending, slicing up Social Security and any number of things.
All of these ideas are completely insane.
You'll never know about it if you pay attention to traditional sources, but the level of borrowing made by this country has actually gone down since the "Great Recession" started.
According to the Council of Foreign Relations, borrowing by private citizens and businesses has collapsed, and the increase in borrowing by the federal government has failed to make up the difference.
Markets just aren't worried about inflation in the United States. Interest rates are still incredibly low, and the dollar just hit a six-month high against the Euro. If investors were worried about inflation, shouldn't they be fleeing the dollar as opposed to rushing to it?
Republican Congressman Mike Pence has been making media appearances and talking about how the solution to our budget deficits is to cut taxes.
Think about that. The way to cut down on budget deficits, according to Muncie's own congressman, is to cut more revenue. He's a talented politician, but on policy grounds he's the equivalent of Miss South Carolina.
Democratic Sen. Evan Bayh has talked about cutting down on spending in order to alleviate our budget deficit problem. Forgive me for being cynical, but this is the same Bayh who voted for two large tax cuts, a prescription drug program and authorizations for two wars, all of which went completely unfunded, and all of which contribute greatly to our current fiscal problems.
Say what you want about the worthiness of those programs, but the fact remains that anyone with that voting record who whines about deficits and paying for programs is a hypocrite. But Bayh knows the media will let him get away with it.
Rep. Paul Ryan of Wisconsin is the top Republican on the House Budget Committee. Last year, he introduced a budget to counter Democratic proposals. His proposal was laughed at, and deservingly so because Ryan's budget didn't include any numbers.
Now, Ryan has come out with another budget, and this one actually has numbers in it. A large plank of it includes privatizing Social Security and Medicare and giving out vouchers to seniors so they can purchase private plans, putting the fate of more of their retirement funds in the unstable hands of Wall Street. Sound smart?
The voucher idea is a joke, because the vouchers' value would increase at about a 2.7 percent clip each year. However, health care costs are projected to rise at 5 percent a year. In essence, Ryan's plan cuts down on health care costs by being worth less and less as time goes on. And the Democrats are the ones accused of rationing?
During this time, President Barack Obama has refused to provide clear leadership to members of Congress, and his party is suffering for it. For all this talk and efforts at working with Republicans, he's produced real cooperation on almost nothing.
It makes sense: An opposition party isn't supposed to like what you do, or else they wouldn't be an opposition party.
Yet, Obama is wasting away his presidency waiting around for bipartisanship that will never come, and he's doing it while we have 10 percent unemployment. I expect people will find "Hey, I tried..." rather unconvincing if Obama tries using that as an excuse for not doing anything to fix the unemployment problem.
Democrats control everything, yet keep making excuses for their inaction. The problem isn't fiscal; it's leadership. If President Obama doesn't wise up soon and push through what he campaigned for, the November mid-term elections are going to hurt badly for him, and much worse for us.
Write to Michael at mgkarafin@bsu.edu.
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