Paulson, “Congress, Can I Please Get My Credit Limit Increased?”

The secretary of treasury wants to increase his spending again.  I think the debt professionals at Saturday Night Live have some advice for them.

 Now I know this is complicated, so maybe the Secretary of the Treasury should watch this once again. 

I thought these people were supposed to be smart.  There is a threat of a recession on the horizon, and we are spending more and more now.  If we can’t manage our budget during the better years what will we do when things actually get bad?  What are they thinking? 

The worst part is that we continue to have faith in them.  Social security is going to be a complete disaster, medicare and medicaid will be worse, and who knows who will finance the retirement of military vets.  It’s going to be great.  A bunch of cranky old sick people who know how to kill other people wandering around town in a bad mood.  If we already have massive liabilities that we don’t know how we are going to cover, why are we increasing spending right now?  We should be cutting expenses and getting ready for the perfect storm that is coming, both as a country and personally.  That means, “Don’t buy stuff you cannot afford”. 

Savings rates were once positive in this country.  The fact that they are already negative is very scary, especially seeing that baby boomers are still supposed to be socking away money.  If, as a country, we have a negative savings rate now, where will we be in 15 years when all of the baby boomers retire.  With those extremely negative savings rates, our credit rating around the world will be dropping like a rock.  We will be the country that is paying high interest rates because there is so much doubt in our ability to repay our debts. 

It looks like they may just use infaltion to debase the debts, slaughtering the accounts of those who were responsible and saved.  The catch is actions like this promote irresponsible behavior in the citizens.  Savers are what allows growth of industry through financing new equipment, factories, and research.  Why do we punish them?  I guess the government will end up getting the citizens it deserves in this case. 

It will be interesting to see how things shake out, but it would be a lot more pleasant waiting if both our government and our citizens tried to be a little responsible in the meantime.

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