Preventing solutions: the American Way

I continue to recollect how I felt about the opportunities leading up to the 2008 election.   It was probably fantasy on my part, but I felt it was possible to come together to make hard decisions about the unsustainable obligated spending programs of Social Security and Medical-Benefit programs.   It was an opportunity to make deep changes to be more realistic both in terms of the limitations of these benefits and in terms of raising new revenues to pay for them instead of moving the expenses to debt.

It didn’t happen.  I admit the most reasonable explanation is that I was fantasizing.  I have an imagination that is sometimes hard to control.

Is it really true that so few other fellow citizens are concerned about paying for our obligations to pay individuals perpetually and recurring moneys without that money coming from current revenues?   No matter how the programs were sold as some form of deferred compensation, the fact has always been that the programs are funded by revenues collected by current economic activities (especially payroll taxes) or added to the debt.   There is simply no other source of money such as some kind of investment account.

We are paying for these obligations with money we don’t have.  The added debt is worse because there is no collateral to back it up.  This money is not going to investments that can themselves provide some return.   Instead the debt must be paid back from some source outside of the recipients of these payments.

The solution is possible with a combination of hard deep choices to reduce the obligations and to increase the revenues: the key being a sharing of the unfairness of it all.

I was encouraged by the recent talk by the CBO director as recorded by C-SPAN.   First of all, I admired the way he presented the role of CBO.  During the first half of the talk, I felt real regret in not having had the opportunity to participate in something like the CBO, or in fact the CBO itself.   I appreciate the challenges they face and especially the scale of the complexity of forecasting for long periods of the entire economy of the country.   As usual, my interest in helping is not matched by my qualifications to help.   In any event, I was encouraged to hear what he has to say at around the 15:00 mark.  He is speaking to what I’m thinking in this article: that we have to come together as a society to make some hard choices.   He makes the additional valuable point about the benefits of making the hard choices early so that the full (painful) affects aren’t felt until later years.   This gives people a chance to work the changes into their planning of their circumstances whether it is more cost sharing of benefits, or more taxes to fund the obligations.

A solution is possible that involves deep but shared sacrifices but where the effects are in the future.

I think (or fantasize) that there may be a majority of US citizens who are willing to work together to make this happen.  Maybe even a super-majority can support such structural changes.

But it can not happen.   More precisely, there are at least two very powerful minorities who work hard to make sure this never happens.  While both have solutions involving sacrifices, the sacrifices are not shared.   The solutions are only possible if one side has full control of the government.   Until that happens, then the entire focus of political discussion is on winning the entire government.  This win-all attitude stifles any possibility of a shared-cost solution because such compromise will dilute the distinction of their brand.  Also, an early shared-cost solution would make it impossible to replace with a one-side solution when they get that full control that is always one election cycle away.

Compromise must be prevented in order to maximize the case they will make in the next election cycle.  Their principle job duty becomes preparing for the next election battle rather than working on a solution that could weaken the intensity of that election battle let alone weaken their case they hope to bring to that battle.

We hear a lot about our country being nearly equally divided.   However, I think this is misleading.  I think the divide is really approximately 20% on one side, 20% on the other side and the remaining 60% who are torn between the two sides but are being asked to choose one side or the other.

I see parallels with the events of Ukraine.   With the usual disclaimer of being uninformed, I do view the events in terms of what I see happening in my country.   Recently there was a referendum in Crimea where there was near unanimous consent to join Russia while earlier elections showed much more substantial support for being in an Ukraine distinct from Russia.

In my sloppy interpretation, I see a population who mostly just wants to remove the divisions they see within their neighborhoods.  Russia-allied neighbors showed a strong yet not frightening hand.  Those inclined to remain independent decided that this is an opportunity to get along and lent their support.   A simpler and completely opposite dynamic is occurring at the other end of the country.  The battleground remains in the middle.

The existence of the battleground in the middle is the fact that the two extremes are encouraged by the prospect that they can win it all.   All of the focus is on fighting in that battleground.  During this fight the topic of any kind of shared solution is completely off the table: no one is taking a shared solution seriously.

I see the same thing happening in our country.  In 2008, there was a sense that we were ready to come together to work on a shared solution.   But then successive elections encouraged both sides that a single sided solution is within reach with just a little more attention paid to the fight.   This is our version of the Euromaidan and Russia-Crimea victories.

Lost in the middle are the majority (if not super majority) who are very aware of the underlying issue is their country’s risk of bankruptcy unless there are broad structural changes.   This majority is willing to work through the issues into a shared burden solution but that solution is not available to them.

The only choice is picking one side or the others.  For those who are willing to work with their neighbors, the choice is only which of the intransigent minorities have the upper hand locally.

For our economic obligated spending problems, there are three sides: the two sides we are forced to choose between and the choice we have no choice to consider.   That third disallowed choice may be the best one and the one that can enjoy a true majority support, but we are instead forced to choose between one of the other two simply because the two sides sees the possibility of winning everything in the upcoming election and saw this the day after the last election came oh-so-close to that ideal.

Like the Ukraine citizens in the middle, the ones who don’t identify with either side can only watch and wait until our turn to choose the strongest of the two sides that ideologically cannot even acknowledge the existence of a middle.

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One thought on “Preventing solutions: the American Way

  1. Pingback: Implicit Third Party: Decisionmaker | kenneumeister

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