A few painful truths

We are overlooking some very painful truths primarily for short term gain. As I chatted with staff members for several US Senators, I found myself saying “you sound like a young person; you do realize we are leaving this problem for you?” I hope they start thinking more about what I said because of what we are ignoring.

The reason for my question is Congress has passed one Tax bill and is debating another that will increase our $20.5 trillion debt by at least $1.5 trillion. Yet, not only are we ignoring the $20.5 trillion debt, we are ignoring that the Congressional Budget Office projects that figure to grow by $10 trillion without the Tax bill impact. So, in 2027, the debt could be $32 trillion if the Tax bill is signed into law. This is beyond poor stewardship – it is malfeasance. We would be screwing those young staffers I spoke with.

Unfortunately, there is more. Our leadership has decided to make the US the only country in the world to not support the Paris Climate Change Accord. Not only are we denying hard truths and overwhelming scientific evidence, we are shooting ourselves and planet in the foot. Renewable energy is passed the tipping point and we risk getting left behind as other nations invest in Innovation for the new economy. Fortunately, cities, states and businesses are carrying the banner dropped by our leadership, who is being relegated to the kids table at Thanksgiving. At the next post-Paris event, the US may not be invited at all. If we don’t deal more decisively with climate change, we will be screwing those young staffers and their children.

A final issue to mention, but not the final problem we are ignoring, is the US is retrenching from our global leadership role to the delight of China and Russia and chagrin of our western allies. The President gave a speech in Vietnam this month similar to the one made in Davos earlier in the year. America will retrench to a nationalistic country seeking bilateral agreements. On each occasion, his speech was followed by Xi Jingping who gave the global leadership speech the US normally gives. What our President fails to understand is globalization lifts all boats and our economy benefits more than if we look to maximize only our share. This concept has been called the “Nash Equilibrium” in honor of the Nobel Economics prize winner who developed it, John Nash. If we retrench, we will be harming our future growth and screwing those young staffers.

As I mention, these are not the only things we are ignoring – poverty, job losses due to technology advances, healthcare costs, environmental degradation, infrastructure, better gun control, etc. Yet, should we not alter our path set by these leaders, this path will be defined in the future as the period when the US gave up its global leadership role. And, the world will be a lesser place because of it. Sadly, I have witnessed these words spoken by more than a few global financial and security experts.

 

 

30 thoughts on “A few painful truths

    • Janis, agreed. Although he is very conservative, hopefully Pence will step in sooner. I do not see Trump finishing his first term. There are too many negative paths he created which will lead to his downfall. Keith

      • Keith … I am glad to hear you say that. As you know, that is my opinion also, that he cannot possibly remain in office beyond, I think, the end of next year, but few seem to believe this, and I even hear some contend that he will win re-election in 2020 and serve yet another 4 years. Unthinkable! So, it is heartening for me to know that you share my thoughts, for I cannot even begin to imagine the further damage that could be created in another 3 years under his regime.

      • Jill, we live in an impatient world. Due diligence takes time. I will be surprised if he is not found culpable for collusion with the Russians. There is way too much lying and storychanging, my guess is this time next year, Flynn and Manafort will be in jail along with others that might include Junior and Kushner. They have both followed Senior’s lead in being less than forthcoming. People that think there is no there there are not paying attention. Keith

  1. Note to Readers: This post could have been much longer, as indicated near the end. Ignoring problems and real data are not recipes for good legislation. We are ignoring fixing the ACA because politicians have aided and abetted its success by not addressing its imperfections and fueling price increases with overt legislation and executive orders.

  2. Hello Keith
    Now is comment is rather allegorical and satirical; no doubt mathematicians and cosmologists would tear this apart, but anyway.
    On short scale a trillion is a million, million
    A dollar coin is 2mm thick, which makes the 20 trillion deficit 40,000,000,000,000 mm thick
    Which makes is 4,000,000,000,000 cms. Which equals 40,000,000,000 metres. There are1609.34 metres to a mile.
    This suggests the debt is approximately 24,854,909 miles long, which indicates the debt is roughly 3/4 of the distance to Mars.
    This debt cannot be a good thing if this is the resultant modest calculation
    (Feel free to pass this hypothesis onto those more versed in measurements and quantifying )
    Best wishes
    Roger

    • Roger, that debt is a long way beyond our atmosphere. For the first time since a January New York Times article, I saw this morning an editorial that mentions the $10 trillion projected increase above the current $20 trillion and the proposed $1.5 trillion in the Tax bill. What is wrong with these people? It should not be lost on anyone that this President has experienced bankruptcy in his businessss six times and almost went personally bankrupt. Expecting financial stewardship from this man is a large stretch. Keith

      • You can take the guy out the Civil Service Jill, but you can’t take the Civil Service out of the…….or have I said that before? šŸ˜

      • Seriously. 20 trillion? I mean how do you deal with 20 trillion. It’s the sort of number which only makes sense when dealing with Cosmology or how many cells there are in human body (btw possibly 40 trillion, but different methods give different figures).
        Whatever it is, it shouldn’t be a national debt and there shouldn’t be tax cuts at this time.

      • You know that … and I know that … and Keith knows that. But, Trump mentioned back on the campaign trail that if the debt got too high, he would just print nore money! He thinks it’s a bloomin’ game of Monopoly!!!!!!

      • Since Quantative Easing is a delicate and subtle business and thus beyond him he must be thinking of Zimbabwe and the Weimar Republic’s approaches……look how well that turned out!
        Pah!!šŸ˜¤

      • Roger, as scary and unreal as $20 trillion is, $32 trillion is 60% larger. I always debate if malfeasance is too strong a word, but it is actually apropos. Keith

      • Roger, civil service folks are trying to do their best to serve the public. Seeing department heads with little knowledge being appointed to oversee them has to be frustrating. Keith

      • Roger, Jill, what has consistently surprised me about Trump is he is not as financially adroit as he is portrayed to be. He is a great sales person, but does merit as high a rating of his management skills – so say financial journalists who have covered him for years. Keitb

      • Yes, and I keep remembering an analysis I read early on in his campaign, that if he had wisely invested the money his father gave him in the beginning, he would be wealthier than he is …

  3. All excellent points, Keith. The administration seems to have the party attitude: Live for today and tomorrow be damned. If this continues, tomorrow will indeed be damned. Good post.

    • Jill, what is the old proverb about who benefits from the tree shade of the seeds you plant? The President’s proverb is simply “what’s in it for me?” Keith

      • Jill, although I do not watch the show, I read that on an old episode (circa 2003) of “The Simpsons,” the young girl dreamed of being President following President Donald Trump. The US was bankrupt. This is eerily prescient. Keith

    • Colette, to your point, due diligence is hard, time consuming work. Our politicians would rather govern off rhetoric and even nonpartisan organizations who cite facts are condemned for inaccuracy. Senator Orrin Hatch blew up in a conference meeting at a Democrat colleague showing mocked offense, but the bill Hatch is advocating is doing precisely what he showing offense over. It was theatrics. Keith

    • Putin is a happy man. Trump spoke with him for over an hour yesterday. My question is how many allied leaders has he spoken to over one hour? I would wager some of the discussion was around how do I get out of this mess?

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