Patterson: Economic recovery can't happen until we deal with spending addiction - East Valley Tribune: Columnists

Patterson: Economic recovery can't happen until we deal with spending addiction

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East Valley resident Tom Patterson (pattersontomc@cox.net) is a retired physician and former state senator.

Posted: Sunday, November 18, 2012 7:00 am | Updated: 9:26 am, Mon Nov 19, 2012.

In this highly contentious election season, we all agreed about one thing: This was a big deal. The two presidential candidates offered vividly contrasting visions of America's future. It was taxing the rich versus tax reform, it was redesigning our entitlement programs versus maintaining them as is, it was fiscal discipline versus deficits indefinitely.

You can parse the election results however – poor Republican turnout effort, morons blabbing about rape, Sandy – but it doesn't matter. The tax and spenders won the presidency, the U.S. Senate and the right to continue to dominate policymaking. What they didn't win was the ability to repeal the laws of economics or to wish away the dire fiscal straits we inhabit.

It's not quite accurate to say we're headed the way of Greece. We are there. Our per capita national debt is considerably higher than theirs yet we selected a leader who declined to even offer a proposal to limit the growth of our indebtedness. Our credit ratings are declining but, unlike Greece, we're too big for our creditors to boss around yet. What we have in common with Greece and the other socialist democracies is that we are all finding out that it's less painful to walk over hot coals than to cut spending in the modern welfare state.

Although even minor spending cuts incite riots and turn elections, there ultimately is no choice. Significant spending reductions are part of any viable recovery plan. We could take 100 percent of the income of America's millionaires and still reduce the deficit less than 10 percent. We could stimulate private sector growth by reducing the onslaught of regulations and demagoguery against businesses, but even that wouldn't restore fiscal health without major spending reductions.

Look at the panicked reaction to the "fiscal cliff" to see how unserious we are about fundamentally changing our ways. What's so different about the cliff versus the mix of revenue enhancements and spending cuts even the president says are necessary?

On the tax side, the "Bush tax cuts for the rich" were bitterly criticized at the time for favoring the wealthy. So why isn't their elimination scored as a tax on the wealthy? Oh wait. Tax cuts don't stimulate the economy, we're told, but we'll cause a recession if these taxes are restored. You can't have it both ways.

On the spending side, many Republicans object to the large military budget cuts. Fair enough, national defense is a constitutional duty of the federal government. But do we really need to spend more ($740 billion) then all the rest of the nations on earth combined ($540 billion) to keep our country safe?

We should look not only at the waste in our procurement policies, but at the mission itself. Nation building isn't going well in Afghanistan, a notorious briar patch for interveners. In Iraq, where Obama pulled the troops out when time was up rather than when goals were achieved, conditions seem to be reverting to those that were present before we spent our dollars and blood over there. Even if these foreign wars did have positive outcomes, we need the resources that would be saved by a more focused, robustly defensive foreign policy.

Look, going over the cliff would be painful. That's why even the president who proposed the policy now avoids it like the plague. And it could use some tweaking.

But we have spent and borrowed ourselves into a position where sooner or later change is inevitable. Borrowing 40 cents from the kids for every dollar spent isn't a plan that works for long.

What would it take for Americans to change their basic expectations of government? Addiction doctors talk about "bottoming out" – that point addicts reach where they have exhausted all their resources, their enablers have left and things can't get any worse. For many, then and only then can they go through the ordeal necessary to get back to health.

Hitting bottom would be painful for Americans too. Even talking about it doesn't win friends or elections, as we have seen. But the sooner we deal with our spending addiction, the less difficult our recovery will be. The free and prosperous America that our ancestors gave us is still worth fighting for.

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