We need problem-solving, not political posturing

Don't miss Dr. Ingram on "Be The People" on WSMV, Channel 4, at 11:30 p.m. on Sunday. Dr. Ingram will discuss deficits and the growth of entitlement programs, as well as possible solutions.

Hosted by Dr. Carol Swain, Be the People is a new hard-hitting television series directly confronting the hot topic issues facing Americans today. Featuring one-on-one interviews and panel discussions with influential politicians, businessmen, journalists, celebrities, entertainers and nationally known political pundits.

I guess cutting out the political posturing and addressing some actual fiscal problems wasn’t among Congress’ New Year’s resolutions.  And if you hadn’t noticed, the fiscal crisis points are now accelerating in 2013.

First we had the debt limit maneuvering in the summer of 2011, which lead to the Super Committee’s non-attempt to come up with bipartisan long-term solutions by the end of 2012 or face the fiscal cliff. To avert the consequences of the fiscal cliff, we got the after-midnight agreement to enhance revenues (ending the payroll tax holiday on everyone and higher income tax rates on high income earners).  Now we face predetermined sequestration on March 1, the deadline for funding the rest of the fiscal year on March 27, and the Congressional self-imposed deadline to vote on a budget outline or suspend their pay by April 15.  

The problem with all of this political confrontation is that it tends to draw attention away from the real national fiscal problem.  By focusing on whether, and by how much, we should increase the current official debt limit, we continue to move closer to the real debt limit -- which is the point at which outsiders (international interests) stop allowing us to live beyond our means by refusing to lend to us anymore.  I cannot say when that will be, but if we were a business looking for more credit with the current levels of revenues versus spending we would already be at our borrowing limit. 

Being a sovereign nation with the power to tax and issue money affords us borrowing advantage, but as we have seen by the examples of other nations there is an ultimate limit and negative consequences that will begin to appear even before we approach that true limit.

The fundamental problem that we face as a nation is that our federal budget is now dominated by entitlement programs like Medicare that mandate spending at increasing rates and the unwillingness for most of us to have our own taxes raised. We praise politicians when they pass programs and projects that we benefit from, but we threaten to vote them out of office if they raise our taxes.

And in a vain effort to make both sides happy, our leaders continue to keep maneuvering, rather than solving problems, setting up one artificial deadline after another. Both our politicians and the public need to accept that when it comes to the economy, we can’t have it both ways.

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Bill Ingram

Bill Ingram

Professor

Dr. William C. Ingram, professor of finance and economics at Lipscomb University, teaches courses in... [More]

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