J. Fred Lundstrom, Nevis, Minn., Published April 26 2012
Letter: Remove zeros and get better idea of nation’s budget irresponsibilityI, like many Americans, have been very concerned with our government’s irresponsible spending. Neither party can be very proud of their record of good stewardship of our money, but under President Barack Obama spending has been on steroids.
Many of us can’t even imagine a billion dollars, so a trillion dollars is off in space somewhere. John Stossel, a frequent guest on TV, used an example most of us can relate to. He took the government’s own proposed budget and crossed off eight zeros. An example would be $100,000,000 becomes $1. This is a budget we can all understand. This is our family budget based on this example:
• Total household debt – $140,000.
• Household income – $21,700.
• Household spending – $38,200.
• New debt (what we want to borrow for next yr.) – $16,500.
• Savings we have been able to cut from our spending. – $385.
I checked with two banks and, of course, neither would lend this family more money. One explained that once the debt to income ratio exceeds 40 percent it is considered a very risky loan. This family’s ratio is 231 percent. Remember in this example the family is the government and we are the banks.
We are rapidly becoming insolvent like Greece, but unlike Greece we are too big for anyone to bail out. President Obama has proposed a special tax (double the old rate) on the investments (these have already been taxed at least once at income tax rates) of millionaires and billionaires. This at best would raise $50. (8 zeros removed) for the government family budget. However it wouldn’t be used to reduce the debt. President Obama will spend it on education and research and spending cuts are off the table this year.
As the ones being asked (although I don’t remember being asked) for this extra loan we should not just deny the loan but be screaming at them for putting their family into risk of bankruptcy.