Nation’s prosperity on borrowed time

Ed Dornlas, Las Vegas

Tuesday, May 14, 2013 | 2 a.m.

Current events have temporarily pushed aside the national discussion of the country’s budget woes but unfortunately the president is correct in his call for more tax collection.

It’s interesting to step back in the nation’s history to see how other presidents have handled budget shortfalls. Surprisingly, Democratic president Harry S. Truman raised taxes to pay for the Korean War and after his election, Republican President Dwight D. Eisenhower journeyed to Korea to halt the war, even before taking office. Fiscal responsibility was abandoned under Republican President Richard Nixon when in August of 1971, he announced to the world that the United States would no longer honor its dollars by exchanging them for gold.

Release from the gold standard allowed successive politicians to expand our spending without raising our taxes to the point where today we borrow around 40 cents of each dollar we spend. Borrowing has allowed us to keep our standard of living much higher than it would be if we were all paying about twice the tax rate we presently enjoy.

The promoters of prosperity at the Federal Reserve and their spokes-economists, such as Paul Krugman, assure us that all is going great (the stock market and local real estate prices rising in unison to nose-bleed levels — what a coincidence), but eventually the piper must be paid.