Las Vegas Sun

November 27, 2014

Currently: 47° — Complete forecast | Log in | Create an account

Letter to the editor:

Nation’s prosperity on borrowed time

Another view?

View more of the Las Vegas Sun's opinion section:

Editorials - the Sun's viewpoint.

Columnists - local and syndicated writers.

Letters to the editor - readers' views.

Have your own opinion? Write a letter to the editor.

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.

Join the Discussion:

Check this out for a full explanation of our conversion to the LiveFyre commenting system and instructions on how to sign up for an account.

Full comments policy

Previous Discussion: 24 comments so far…

Comments are moderated by Las Vegas Sun editors. Our goal is not to limit the discussion, but rather to elevate it. Comments should be relevant and contain no abusive language. Comments that are off-topic, vulgar, profane or include personal attacks will be removed. Full comments policy. Additionally, we now display comments from trusted commenters by default. Those wishing to become a trusted commenter need to verify their identity or sign in with Facebook Connect to tie their Facebook account to their Las Vegas Sun account. For more on this change, read our story about how it works and why we did it.

Only trusted comments are displayed on this page. Untrusted comments have expired from this story.

  1. Two fundamental problems need to be resolved. First we need a complete overhaul of the tax system. We need a tax system that is fair and designed to provide the revenue necessary to run the government and scrap the current one which is designed to favor certain economic activities, industries, and economic classes. Second we need to get health care costs under control. With nearly one-fifth of our Gross Domestic Product going to spending for health care we cannot compete with other industrialized countries with successful single payer plans that spend one-eigth or less of their GDPs on healthcare and outlive us.

    We can bitch and moan around the margins of these two issues all we want, but few good things can happen until we get them resolved.

  2. What they don't say is that the Dow is a collection of 30 stocks and the S&P 500 stocks. We have 319 million people in the USA. Ask them how they are doing economically. Especially the working middle class who have little or nothing to show for their efforts and ethics except the depth of their anger and disgust for a corrupt government and elected leaders.

    Carmine D

  3. I believe that American politicians of both parties have given up on ever balancing the budget even for a single year, let alone reducing the accumulated debt. Canada and its individual provinces are at least still promising to balance their budgets in another fiscal year or two.
    I guess we'll just have to stay tuned to determine if over the course of the next decade or so America proves the theory that deficits and debt don't matter, or whether instead America actually declares bankruptcy and/or just up and refuses to pay its foreign creditors.
    America's politicians are beyond belief. At this point in your history your political system is broken, populated by obscenely rich Senators and Congressmen who personally thrive in the status quo.

    Donald W. Desaulniers

  4. Any intelligent and fair minded American should realize by now that if enough taxes were imposed to pay for what the government currently spends and also make a start at paying down our debt, most Americans would be furious at the taxes they had to pay.

    We are living in a 'fantasy' financial world, created and fostered by our elected representatives.... and it cannot continue forever. Eventually, if not addressed, the 'fantasy' will end...and it will end ugly.

    Taxes will have to be raised, but the real solutions involved a new tax system and less spending by the government. Everything else is just window dressing.

    Michael

  5. I'm not exactly sure what the letter writer is worried about. Fiat money has allowed the world economy to grow from a GDP of $12 trillion in the 1970s to the $72 trillion it is today. When the world adhered to a gold standard recessions and depressions occurred constantly.

    Our national debt is equivalent to one years GDP. The national debt of Japan is rapidly approaching 2.5 years GDP. The unemployment rate in the United States is roughly 7.5%. The unemployment rate in Japan is roughly 4.5%.

    Our fiscal problems are due to one factor and one factor only. Medical hyperinflation! If we brought our healthcare costs down to the next most expensive nation which is Norway, that would result in a $60 trillion savings over the next 40 years. That would wipe out our debt and allow us to fund the retirements of the entire baby-boom generation at current tax rates without borrowing a nickel.

  6. Mr. DiFazio is correct. The people in this country are in lousy financial shape. It has very little to do with government and everything to do with hybrid financial instruments, rampant speculation and program trading which has resulted in one financial crisis after another since the 1987 stock market crash.

    In addition the domestic savings rate has been close to zero for much of the last few decades. If you don't save and invest your future is extremely bleak. Americans refuse to defer current consumption to save for retirement. The above factors have created an environment where half the country is relying on some type of government assistance program. That's life! Very little you can do about it at this point.

  7. Gerry,

    I don't disagree that Medical Cost Inflation has contributed greatly to our financial situation. I also think most R lawmakers would simply like to ignore the whole subject and have very little to constructively offer as solutions.

    That said, I have to ask if you feel the ACA will do much of anything to slow Medical Cost Inflation? It will allow more people to be insured but will it change the cost dynamics? I don't think so and that is because our stupid system of funding campaigns allows the big pharma, big insurance and big medical interests to control all the legislation that might affect them. That's why the ACA is what it is, instead of what it could have been.

    Michael

  8. Anyone not a part of the "parasitic class" or a dyed-in-the-wool Commie-lite must see this administration as the most dangerous to our freedoms in decades. The politicalization of the FBI and the IRS has to alarm anyone who cherishes freedom and a check on government snooping and interference in our personal lives, our political views and, even, the news we are fed by the supposedly "free" press. Targeting the political opposition by using the IRS is eeriely Nixonesque and wiretapping the AP, a staunch ally of the Osama Obama administration, is even more frightening. With the goons employed by Osama Obama and his fellow travelers, it proves no one is safe from their underhanded attempts to silence any negative information coming out about or opposition to their leftist agenda. I'm no psychic but I see impeachment looming for the guy with the "Cheshire Cat" grin if Eric Holder and his ilk are not weeded out and soon.

  9. The main advantage of ACA is that it will liberate Americans from employer sponsored insurance and discriminatory insurance restrictions will be minimized. These practices have put millions of Americans into bankruptcy. Many Americans are working at jobs they hate cleaning toilets and making beds just for the health insurance.

    There is nothing that I can see that will reduce costs. In the short term you will see a bump in costs due to increased coverage. That being said the weight of medical costs is putting a damper on the entire economy. Businesses spend hundreds of billions of dollars to cover medical for their workers when they should be concentrating on putting out better goods and services. It puts American industry at a comparative disadvantage. Businesses in other countries don't have to worry about such nonsense.

    I was one of the chief architects of the entire ERISA medical reimbursement trust industry and worked on medical issues for decades. I look at healthcare as a massive bubble. At some point someone or some group will stick a needle into the bubble and we will get healthcare that we can afford. I don't know when that will be or what will cause it.

  10. Mr. Fink... This country spends a fortune on all these congressional investigations. It seems like every week there's a new one. How many of these investigations have amounted to a hill of beans over the last 50 years. A small handful! It's all nothing more than a media circus.

  11. People abuse everything. Maybe we should crawl back into the caves. Sam Walton was once asked what he believed was the greatest threat to retailing. His response....THEFT. Help folks with their needs or they will get it from criminal activity. Either way there is a cost. Walmart alone loses billions to theft yearly, much from employees.
    $500 billion from Medicare??? That statement was voted one of the biggest lies of the year. Complete nonsense.

  12. Gerry,

    If employer provided health coverage goes away yet the ACA does little to nothing about health care cost hyperinflation, I don't see how it helps the situation that the millions of people that had employer provided health care coverage now have to purchase insurance on their own for much higher costs.

    I'll readily admit the system we have stinks, but I just don't see how the ACA makes it better.

    Michael

  13. zippert1@7:38,
    "I'm not exactly sure what the letter writer is worried about. Fiat money has allowed the world economy to grow from a GDP of $12 trillion in the 1970s to the $72 trillion it is today. When the world adhered to a gold standard recessions and depressions occurred constantly."

    GDP is the dollar value of our nation's output. It doesn't reflect any improvement in our lives or in the condition of our economy.

    Recessions and depressions prior to the Federal Reserve Act were not due to the gold standard. There were several reasons; 1st and 2nd Banks of the U.S., bi-metalism, and lastly, the most destructive policy that we've had since the beginning; fractional reserve banking.

    ~gotta go back to work now, but I'll be back this evening. Peace.

  14. VidiVeritas continues to point out the mistakes made by Republican Administrations and Republican members of Congress and then seems to draw the following conclusions:

    (1) Republican administrations and Republican members of Congress do 'everything' wrong, 'nothing' right, are downright corrupt and evil and are responsible for 'everything' that is wrong in America.

    (2) All that needs to be done is to rid ourselves of all Republicans and Democrats would fix everything and we would all live in the land of milk and honey.

    I would love to believe that as well, but unfortunately I have lived in the real world for 60 years instead of Fantasyland.

    Michael

  15. Bradley,

    You continue to believe that I am just a flack for Republicans. How sad and inaccurate. I have pointed out, again and again, Republican failures. But I am not naive enough to believe that Democrats do not fully participate in our corrupt system in the legislative branch.

    I doubt if it will happen because Americans are rightly afraid of one party controlling both the Legislative and Executive branches, but if Democrats win the House, retain the Senate and win the Presidency in 2016, I hope we are both still around to see that it 'does not' result in what you, Vidi and many others think it will.

    What you and others on one side spout are Democratic talking points. Others spout Republican talking points. The reality is that we have a structural problem in the legislative branch that hamstrings members of both parties into making decisions, not in the countries best interests, but instead in their own interests in obtaining and retaining power.

    The beliefs of those that 'know' that one party is evil and completely wrong and the other is a 'savior' are foolish and naive. I'd love to see you recognize the truth but I'm afraid that is going to require more evidence that I am right and you are wrong.

    Michael

  16. Unintended consequences come back to bite, eh? After 9/11 80% of you, and yes, I mean you, were foaming at the mouth to give the Feds more power to fight terrorism, tap phones, use star chamber proceeding for extra-judicial punishment, rendition suspects, create concentration camps in several foreign countries, opened Guantanamo and got Federal attorneys to vet torture. The few in opposition were derided, told they were traitors, etc. Now you're all sniveling that the Feds are actually using the power that YOU WILLINGLY GAVE UP TO THEM. Oh...wait...you didn't mean that they should investigate us even if we march around in stupid hats, carrying idiotic sign and writing letters to the papers and posting online about our 2nd Amendment rights to overthrow the government. You only meant the Muslims or the darkies or the wetbacks or the anyone but us. But here's the good news you idiot conservatives.....the ACLU will probably bail you out...again.

  17. Bradley, Teamster and others,

    You continue to focus on the Presidency while I will remind you that we do not live in a dictatorship. Far more important to us all is our legislative branch, where our laws are made and tax policy written.

    Our legislative branch is 'corrupted' due to the way money is integrated into the election and re-election process and the careerism that runs rampant. Both our parties are neck deep in it and make no moves to change it. THAT is the most serious problem we have and as long as our Republican and Democrat Presidents stay silent about that whole subject (even ones that served in Congress and 'know' how it works), Bradley is right in saying we are past the time for change.

    We can argue about voting for Republican or Democrat Presidents, but no matter who we elect President, if that man or woman just conducts 'business as usual' and does not call for the American people to demand changes in the Congressional system, I consider them 'derelict in their duty'.

    It would take an extremely selfless and brave President to do so because it could very well lead to his or her defeat in the next election or even their assassination, so I don't expect it.

    You both and others see, as I do, that very powerful and entrenched forces are corrupting our system, but you two and others on the left and just as many on the right, believe that one party has aligned themselves with evil and the other with good. Oh, if that were only true, but it isn't.

    Both parties participate in the corrupted system which most Americans are not even aware of. An awakening needs to take place and the easiest way to get it started would be to have a President, any President admit the truth about Congress and call for changes. What we get instead is a Bush that says the Democrats in Congress are the problem and an Obama that says it's the Republicans.

    I'm sorry folks, but it's both and neither. It's the corrupted 'system' in our legislative branch.

    I give you and others credit because you are angry... and you should be. So am I. I just don't have any faith that what is wrong can be solved by believing that one of these parties is going to fix anything that matters.

    Michael

  18. Vidi,

    You seem to believe that I read commentaries like the one you provided the link to and disagree with everything in them. On the contrary, I agree with much of what is in that commentary.

    However,what I also realize is that the situation the writer describes came to be due to our corrupted Congressional 'system', the influence of money in our election process and careerism in Congress. Both parties have in the past and continue today to participate in and actually foster that corrupted system.

    As the Republicans could have when they controlled both Houses of Congress in the past, when Democrats had control after President Obama was elected, they could have moved to change the corrupted Congress, but they didn't. Why? Because they have no interest in changing it, because they all benefit from the present system.

    People see the results of this corrupted system and so does the commentary writer, but they are unable or unwilling to connect the dots and believe that the results are caused by only one party. The 'system' is corrupted and that in turn corrupts both parties. It's not rocket science.

    Michael

  19. Vidi and Bradley,

    I suspect that you both believe that if the Republicans somehow got total control of Congress, they would place their own self interests very high on their priority list and therefore be willing to do the bidding of powerful special interests with lobbyists who could help insure that they stayed in power and control. I believe that too.

    Now let's switch and say that somehow the Democrats got total control of Congress. Are they human beings, just like the Republicans are? Do they, as most human beings do, place their self interests high on their priority lists? Would the same lobbyists still visit and want legislation that advantages their employers? Would the same corrupt Congressional system remain in place that makes it necessary to do the bidding of powerful interests in order to get money and support needed to remain in power and control?

    To me, Republican and Democrat are labels, much like a name such as Michael or Fred or Sally. They are not a breed or a race and people adopting one of those labels belong to the human race, and are subject to greed, self interest, jealousy, etc.

    The label or name Sally tells me zero about her, except that I know as a member of the human race, she is subject to all the frailties, temptations, etc, that all human beings are subject to. What makes you believe that the 'label' Democrat is sure to make that person so different from other human beings and so able to resist the temptations of our corrupted congressional system?

    Michael

  20. Jeff,

    I am not Italian and my answer to you is none of the above. The change necessary cannot and will not come from within Congress. It can't. The people in Congress would be harming themselves and their positions to institute any of the changes necessary. They are the 'beneficiaries', along with the lobbyists and their employers ... of the present system. You and I and others are the ones damaged by the present system. The push for change must come from outside Congress; either the citizenry, a very brave President or both.

    Michael

  21. Enough government. Let's downsize the feds to enumerated powers and limit defense to the integrity of the physical U.S. We can't afford and still must pay off the debt from "protecting" the rest of the world from the rest of the world. Let's downsize the feds to RETURN TO State's and individuals their rights to pursue their freedom, economic freedom, fron continual intervention and (tax) participation. Let's provide TEMPORARY assistance to citizens who have been productive or are clearly disabled. That assistance should be designed, provided, monitored, audited at the LOCAL LEVEL.

  22. Jeff,

    You disagree with me, which is fine. I don't believe that any single member of Congress or even a group in Congress will 'ever' propose changes that we need to make to this corrupted system. It isn't in their interests to do so and in fact would damage their interests and positions. The push for this change must come from a President or the citizenry.

    As they say, you cannot address a problem unless you first identify it. I paid attention to government and politics since I was 18 and still didn't realize the real problem until I was in my early 50's. Even most people that pay attention and are somewhat informed (a minority in this country) do not see the real problem and therefore, certainly can't ask that it be addressed.

    I just keep pointing out the problem because in all honesty, that's all I can do. Voting D won't fix it. Voting R won't fix it. It's the 'system' that needs to be changed and unfortunately, every person we send into that system, must participate in it and support and protect it to survive and prosper in office.

    Michael

  23. Jeff,

    I wanted to thank you for saying that I am a closet progressive on some issues. You are, I think, the only one that leans Progressive that is willing to say I am anything but a died in the wool conservative on every issue and a liar and a fraud to boot.

    Thanks for the 'left' handed complement...

    Michael

  24. I guess I understand why Notacon is a Progressive and favors a giant Federal Government. The statement 'the states are the incubators of stupidity.' pretty much sums up the extent of his thinking.

    I happen to think good ideas can come from Federal or State governments and also that when any entity gets large enough, abuses tend to occur.

    Michael