6/23/2005

Goodbye

Well, folks, the time has come for me to say goodbye.  I’ve enjoyed sharing my opinions with you for the past two years, but I’ve decided there are lots of things I want to do which are going to keep me from devoting the time I need to make sure what I write is worth reading.  Not that all of you thought it was worth reading before.

While it’s been fun, there certainly have been some ups-and-downs.  The feedback’s been great, whether you agreed with me or not.  By far, my favorites have been from people who said they didn’t necessarily agree with me, but that a column or idea made them think.  That’s all I could ever ask.

But it has not been without its downside.  I know I’ve ruffled some feathers, taking positions that were extremely unpopular with some people.  That’s been very difficult at times, especially when I knew taking a different stance would probably be in my own best interest.  If nothing else, I would hope those who disagreed would at least appreciate that I never let my own interests compromise my principles.

I would also hope that after two years that some of those principles would have become clear.  Principles like taking personal responsibility for our own lives and situations.  Not looking to government to fulfill all our wants and desires.  Respecting education as the single most important investment we can make in ourselves and our children.  And last but not least, remembering that life is what we make it.  Appreciate the good things that happen and let the bad things go.  It makes life so much easier.

So with that, I’ll leave you with a few thoughts on what I’d like to see in the months and years ahead.

I’d like to see us teach our children that success isn’t measured by the size of one’s house, but by the size of one’s heart.  Find passions in life and pursue them with gusto, otherwise all the money in the world won’t make you happy.  Follow your heart and you’ll find success.

I’d also like to teach them that life isn’t always fair.  Don’t dwell on slights and setbacks.  That’s the road to bitterness.  Instead, pick yourself up, dust yourself off, and move on.  It’s like a flat tire – you can curse the nail and kick the car, but that gets you nowhere.  Fix it and be on your way.

Let’s seek out opinions contrary to our own.  If you’re conservative, read the New York Times and listen to NPR.  If you’re liberal, listen to Rush Limbaugh and watch Fox News.  Like a weightlifter, if your views never face resistance they’ll become weak and flabby.  Exercising our minds is as important as exercising our bodies.

Treat each other with respect.  We can disagree, but we don’t have to be nasty.  Which brings me to my one regret regarding this column.  Last December I wrote a very sarcastic column that unfairly ridiculed some of our elected leaders, most notably the West Chester Township trustees.  It was uncalled for.  Whatever differences of opinion we might have, George Lang, Catherine Stoker and Jose Alvarez are all good people who sincerely care about their community.  I have personally apologized to George, and I’d like to publicly apologize to Catherine and Jose.  I hope they’ll accept it.


With that, I’m off.  But I won’t be gone.  Thanks for reading.

6/09/2005

Mortgaging Our Future

Remember the economy just before the stock market bubble burst? Jobs were so plentiful that fast food joints were offering signing bonuses and one tech interviewee actually invoiced a prospective employer for the time he spent interviewing with them. With skyrocketing stock prices, we were feeling flush and believed we could do anything.

Well, would you believe that the economy has grown faster in the past two years than it did in the two years leading up to the stock market peak in March of 2000? Yep, adjusted for inflation, gross domestic product has surged 8.9 percent in the past two years versus 8.5 percent in the two years ending in March of 2000. So why do things feel so unsettled today compared to five years ago?

For one, we’re coming off the sluggishness early in the decade. We’re at war, for another. But I think the real reason is far more fundamental – and here is where I put my economist’s hat on.

Not to generalize too much, but there are generally two schools of thought on government deficit spending. To fight off recession, you can increase spending to generate demand or cut taxes to spur private spending and investment.

We’ve used a combination of these two policies – increased government spending AND reduced taxes. In the process, we ran up record government deficits, excluding Social Security surpluses, of almost $600 billion in 2004. Meanwhile, our trade deficit – the difference in how much we import versus how much we export – was a little over $600 billion last year.

So what we have is a government that provides us with $600 billion in government programs and services for which we’re not paying (at least not yet). Then we go and spend that $600 billion on stuff overseas. Essentially, we are financing a huge foreign shopping spree, with the feds as the credit card company. Granted, it’s far more complex than that, but bottom line, the amount we borrow to fund the government is about equal to our excess overseas purchases.

The end result is that the deficit spending that economists say should boost our economy is doing as much, if not more, to create jobs in China, Korea and India as it is to create jobs at home. We don’t feel it materially because our lifestyle is being maintained by this government-funded foreign splurge. But we feel it psychologically, as evidenced by consistently low consumer confidence surveys. Perhaps deep down we realize we’re spending our future rather than investing in it.

The real danger is that our foreign trading partners are the ones funding our federal deficits. They use the cash they get from us to buy U.S. government securities. They essentially sell us stuff, then loan the money back to us to buy more. What happens if they decide they have better things to do with their money?

I have no problem borrowing to finance a house, business or asset that will provide a future return on investment. But I believe it’s unwise to finance a lifestyle. Yet that seems to be what we are doing as a society. It’s a message no politician will ever give, but at some point we are going to have to sacrifice the boat, big-screen TV or some government services and start paying as we go. Otherwise we could find ourselves sacrificing something much more precious – our future.