Tuesday, November 13, 2012

Take the Plunge

It is time to take a ride "over the fiscal  cliff."  Any compromise is only likely to make matters worse by pushing the problem down the road.  It will not be long before the only solution to our fiscal woes is the kind of economic and political chaos that is modern day Greece.

Far better to take the poison pill now.  Yes, the economy will suffer.  But, what happens in five years when the so-called compromise or grand solution unravels because it never had any substance anyway.  Politicians will find a way to "extend and pretend."  Why bother?

If we plunge over the fiscal cliff, then the implications of the entitlement state will be front and center for the body politic.  Better to face it now than later.  It is fixable now, if we see it as an emergency, which a plunge over the cliff will provide.

This Administration intends to insist on higher rates that will imperil our economic future and lead to a 1970s style economic stagnation or a 1930s style depression.  Since that is the direction Obama intends to take, why not see the implications of that future sooner rather than later.

No one is pushing free market solutions.  The nation has a negative savings rate (if you include government savings).  There are no assets to provide income security for the elderly or bankroll the promised health care benefits.  Nothing has been put aside and there is limited room to tax the middle class (where the bulk of the income is).  So, why temporize?

America's problem is simple arithmetic.  The great entitlement society is not affordable.  It doesn't matter what tax rate "millionaires and billionaires" pay.  Total confiscation won't get it done.  The numbers just won't work.

Time to face the facts.  Hang on to your seat belts.  Lets go over the fiscal cliff, including no more increases in the debt limit ceiling.  Lets go for it.

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