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By Bob Harwood

America’s Day Of Reckoning


Tea Party successes brought a new libertarian voice on stage but also reflected anger toward the partisan paralysis in Washington. Obama’s approval rating has since improved as he gave medium-term priority to growth over deficit reduction bartering extending Bush tax cuts for the wealthiest in return for retaining middle-income cuts, extending unemployment insurance benefits, and reducing the Social Security payroll tax by 2%. These stimuli together with those Health Care Reforms effective January 1 will increase household incomes and stimulate private investment immediately.

But more significant longer term was the Debt Commission’s bipartisan report making it clear that America has only postponed its day of reckoning on its unsustainable debt. Massive tax increases and massive spending cuts must be made to achieve smaller, more effective government. They proposed raising the gasoline tax 15 cents per gallon, a three-year freeze on federal and Congressional salaries, cutting congressional and White House budgets by 15%, and much more. Quite separately the Don’t ask, Don’t tell policy in military service was finally repealed.

All aspects of the American Dream are threatened. With 40,000,000 people living in poverty, America must become more centrist, more egalitarian. Astronomic, open-ended, even legally anonymous, campaign financing is obscene. Rich tax complainers might ponder the ethos of Bill Gates, Warren Buffet and the many billionaires who have agreed to give at least half their wealth to charity. With so many industrial union jobs lost, women are increasingly the primary wage earners. Are privileged middle class unionists becoming obsolete in both domestic and globalized, societies? Reducing the cost of government will entail huge cuts in the ranks of public sector jobs.

A rampant credit ethos must be rethought, financial regulation strengthened. The dream of suburban homes with two or more vehicles per driveway, already dimmed by mortgage foreclosures, must give way to higher density urbanization and public transit as in Europe where gasoline prices are two to three times America’s. Britain’s bipartisan government has already come to grips with huge cost reductions impacting all. Public health care in Europe yields better longevity than America’s private system and at lower cost. Beyond the current crisis the fact that world population is aging at an alarming rate has huge ramifications. Fewer workers will be supporting more retirees, retirements will be deferred, health care costs will move inexorably higher. America’s prison population has quadrupled since 1980 with draconian sentences for minor offences. America’s defense spending at a whopping 19% of the federal budget is 40% of the world’s military expenditures.

An assumption that America’s way is somehow superior must yield to objective assessment of what others achieve. America can no longer be the world’s policeman, must move to more collaborative international strategies. Congressional approval of the “Start” nuclear arms reduction treaty with Russia was a good start in that direction. And nowhere is international collaboration more important than on Climate Change, the issue of our time as we are reminded daily with unprecedented floods, wildfires, droughts and storms dominating the news.

America’s position must accept: (1) fair measurement of each country’s emissions must be on a per capita, not per country, basis to allow for vast differences in population and (2) it is the developed nations that have historic responsibility for pushing our planet to the brink in the first place.

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