Or so says Wimpy.
Today, given the non-stop blare of so-called “headline news” coverage that dominates our lives, one would require refuge in a distant monastery in order to avoid the messages being directed our way. And the primary message?
The things of life are broken, and that we as a nation are broke!
For those who follow the U.S. National Debt, you are aware that in percentage terms, we have passed 100% of Gross Domestic Product and are now nearing the so-called “fiscal cliff.” Just yesterday, I commented to a friend who works in the field of investments that it would be interesting to plot the daily headlines as published by the Wall Street Journal. Today, the market is up and tomorrow, the market is down. And then the cycle begins again.
But, you ask, what has any of this to do with Wimpy? Dating back to the early 1930s, Wimpy’s battle cry regarding payment due on a hamburger received was meant to depict a condition of fiscal irresponsibility. And certainly, when we recognize that it took the American Republic two-hundred years to surpass $1 trillion in debt, our present $16.5 trillion debt is quite an accomplishment.
I wonder. Have we patriots become accustomed to receiving much for nothing? According to the National Taxpayer Union, these United States of America have reached a historical point. Today, nearly half of American families pay no federal income tax. Visually, this can be likened to a cart in which half of us are seated and enjoying the ride while the other half pulls. To boot, recent articles have noted that over the years, our elected representatives have voted us trillions of other unfunded “goodies” to be received at various times in our lives, but mostly during retirement. Now this sounds great until we recognize that the funding sources that will make these things appear are seriously questionable. To quote Charlie Brown:
In returning to Wimpy’s fiscal irresponsibility, perhaps these developments are merely an outgrowth of a growing American feeling that the world owes us something. In a sense, this is true. The Social Doctrine of the Catholic Church teaches us that human dignity must be paramount, always to be pursued, and never to be sacrificed. But on the other hand, as the State creates so-called “rights” and “benefits,” does it not also have the responsibility to ensure that they be realistically met? Or is our present path the way of Greece?
A recent remark from IMF Chief, Christine Largarde, suggests the latter. Speaking on CNN’s “State of the Union” talk show, she said that “although the US economy was creating jobs, American debt was still higher than in much of the eurozone and cautioned against more half-baked, short-term measures.”
But does anyone really expect that which is being served up to to the American people to be anything less than half-baked? Some years ago, a wise professor remarked that in the end we deserve our elected officials. For after being exposed to their numerous smiles, ad blitzes, and debate posturing, we settled upon them to not only represent us, but carry forward our values. Given this, are we surprised that our economic future is being hashed out on Twitter as though the matter at hand involved securing a date for next month’s prom?
In that same article, Ms. Lagarde warns that without substantial reform, “If the US economy was to suffer the downside risk of not reaching a comprehensive deal, then growth would be zero.” As most of us know, this would drive our economy into another recession and further lessen opportunities for young people. And perhaps this is why I have held onto an article written last year by Matt Wirz (Why Student Loans are Riskier Bets, Wall Street Journal, November 12/13, 2011). As the headline suggests, it involves an assessment of the potential repayment of student loans by those who seek to invest in them. In regard to the $242 billion market for bonds backed by bundles of student loans, hedge fund manager, Daniel Ades, remarks that:
We know all these deals inside out and we know their default rates. But when it comes to the loans that banks made to students who graduated in 2010 and 2011, we are steering well clear because we can’t quantify the risk.
And while these investors hedge their bets against an historical student loan default rate average of between 25-30% within their portfolios, overall student loan indebtedness now exceeds $1 trillion. Additionally, poor job markets have resulted in a rising number of unemployed college graduates who have contemplated the filing of lawsuits against their alma maters.
To be fair, timing is everything. I remember my own college graduation in the early 1980s that came on the heels of a nasty stagflation that prevailed during the final years of the Carter administration. While recognizing that our nation’s economic struggles are different today, they nevertheless require a resolve of responsibility. In Matthew’s Gospel (Mt 25:14-30), Jesus call us to use our talents within a lens of responsibility.
The one who had received five talents came forward bringing the additional five. He said, ‘Master, you gave me five talents. See, I have made five more.’ His master said to him, ‘Well done, my good and faithful servant. Since you were faithful in small matters, I will give you great responsibilities. Come, share your master’s joy.’
In the end, while Wimpy remains a recognizable figure from the Great Depression era of the 1930s, perhaps what goes around comes around.
Hamburgers for dinner, anyone?