Debt Kills

I know a guy whose finances are really messed up. To say he’s in debt would be like saying someone who is passed out drunk had had a drink. He has so much debt that it would take several lifetimes of hard work to get him out.

It started out small. He used the credit card that was only “for emergencies” for a vacation, promising himself (and his wife) that he would pay it off when the bill came in. When it did, he noticed that the bank gave him the option of making a minimum payment. He decided to do that, because he wanted to buy a few things that month. “I’ll pay it in full when the next bill comes.” As you have probably guessed, he found other uses for the money the next month. Eventually the card was maxed out, so he got another one. “Credit is easy; all you have to do is keep it under control,” he thought. The only problem was that that was all he did. He thought about it, but didn’t do it. Soon he had a third card.

To make a long story short, he ended up with 11 credit cards. One month he didn’t have enough cash for his mortgage payment, so he took a cash advance on one of his cards. The next month he couldn’t make the minimum payment on that card because of the large balance, so he got a cash advance on another card to pay the minimum of the other one. He still had good credit, so he got offers to open new cards every month, most of which he threw away because he already had so many cards. One day he noticed that some of the banks were offering zero interest for the first six months if you transferred a balance from another card. He realized that he could save a lot by transferring the money he owed on high interest cards to new ones. The only problem was that after he transferred the money off several cards, he failed to close the accounts. He kept them open, “Just in case of an emergency.”

Of course, that emergency came in the form of more payments on all these cards coming due and not enough money to pay them. By this time he had 23 cards and was spending a couple of hours each week keeping up with all the payments, interest rate shopping, and opening up more cards so that he wouldn’t lose his credit rating. After all, you can’t get new cards if you have bad credit, right? Finally, no one would extend him any more credit, and the minimum payments were more than he could cover, even after he got a raise at work. So he learned to print money. That’s right, he got a printing press and starting printing $20 bills in his basement. They were very good forgeries, and he didn’t get caught.

You’d think that there would be a happy ending to this story, wouldn’t you? You’d think he’d be smart enough to pay off all his bills, get debt-free, and dismantle the printing press before he got caught. Unfortunately, he was totally addicted to spending by now. He felt he deserved the Porsche, the yacht, and the other toys because he had worked so hard to get them. So he kept on borrowing and spending and printing money. You probably know people like this. In the course of counseling people regarding their finances, I have encountered many who have followed this destructive path. But the “guy” I have been describing is someone all of us know. His name is Uncle Sam.

The last President the United States had who left office with the nation almost debt-free was Andrew Jackson, our seventh president. Jackson inherited a National Debt of over $58 million ($58,421,413.67 to be exact). When he left office in 1837, the debt was $37,000 – less than what Obama spends on one of his “date nights” with Michelle – which we pay for, of course. Now you know why the bankers hated Jackson and why they love Obama!

Jackson was so frugal that he moved out of the White House for two years during his presidency because the roof leaked and there was no money in the Treasury to fix it. His advisors counselled him to borrow the money, but he didn’t believe in that, even though he was a Democrat. He believed that the only legitimate reason for government to borrow money was to pay for the national defense if we were attacked.

They make Democrats much differently today. One of the first things Obama did once he was inaugurated was to spend $3 million just in remodeling the Oval Office – even though there was nothing wrong with it. It was beautiful and luxurious, but it wasn’t good enough for Obama. In the midst of the worst financial crisis in decades, while he was lecturing us about tightening our belts, he spent $3 million unnecessarily. Andrew Jackson would have kicked him out of the Democratic Party.

Jackson also shut down the National Bank of the United States because it was destroying our economy by creating debt. By contrast, Obama is doing his best to raise the maximum National Debt above $14.3 trillion. This is the third time he has asked for such an increase in just two and a half years. If he is successful, our current National Bank, the Federal Reserve System, will be able to print even more trillions of dollars.

Obama has been negotiating with Congress to increase the Debt Ceiling. Many of you don’t realize that he has no right to do this (and obviously Congress doesn’t know, either). If you study the Separation of Powers in the Constitution, it is clear that only Congress has authority to appropriate or borrow money and to deal with the budget. Obama has no constitutional authority to do what he is doing. Not only has he stuck his nose where it doesn’t belong, but also he is threatening the American people with unconstitutional actions if he doesn’t get his way. He claimed that if we don’t raise the debt ceiling by August 2, he couldn’t guarantee that seniors would get their Social Security checks. Democratic leader Chucky Schumer said that airplanes wouldn’t be able to fly because the air traffic controllers will be laid off. And top Democrat Harry Reid has warned that America will lose its credit rating and the whole world will hate us.

These are all BIG, FAT LIES. “Tom, are you calling the President and the Senate Majority Leader liars?” I sure am. When politicians try to frighten senior citizens to death just to get their own way, I call them what they are – despicable liars. These are not simply differences of political opinions. They are outright, well-planned lies designed to cause panic. I will document my charges.

The 14^th Amendment to the Constitution, Section 4, states, “The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned.” This means that if the Debt Ceiling is not raised, and the United States is forced to live within its means (as citizens have to do), Obama cannot default on payments on the National Debt. The first available money must be paid on the debt. Obama cannot choose to use the money for some of his pet Socialist programs instead. So our precious credit rating is safe. As far as the air traffic controllers and the Social Security recipients are concerned, the Executive Branch has the complete authority to prioritize which bills are paid, if there is not enough money to pay all of them. So if grandma doesn’t get her Social Security check, it will be because Obama decided not to give it to her, because he wanted to try to make the Republicans look bad.

Regardless of what he said in his very public lie, Obama can guarantee that the checks will go out. He has that constitutional power.
So he has to pay the debt, and if he has any brains, he will take care of Social Security and safety issues like air traffic control. What, then, can he choose not to pay? There are literally thousands of bogus, wasteful programs that Washington spends our hard-earned tax dollars on every day. Let’s look at just a few.

For starters, we could shut down the Department of Education with virtually no negative impact on education in the United States. It was started in 1980 by Jimmy Carter. I have one simple question for you. Has education in the United States improved in any way in the last 31 years? Any honest American would agree that just the opposite has occurred. Fully 28% of U.S. high school “graduates” are functionally illiterate.

How about the Department of Energy? You would think that with all the billions spent on this department the U.S. would at least have an energy policy. But we have none. We’re like a blind giant stumbling around in the woods. If we shut down the Department of Energy, it could no longer stop the states that want to drill their oil from doing so. Alaska alone has enough proven oil reserves to supply all our needs for at least three decades. The offshore oil that we know of would do that for a century.

Obama and the Department of Energy refuse to allow the safe drilling of either of these treasure troves, preferring to keep us dependent on Arab oil. There are many other useless, unconstitutional departments of the Federal government, but we’ll conclude with some examples of overreaching, obstructionist government regulations that cost Americans individuals and businesses billions every year.

I have a friend who spent several hundred thousand dollars on a large lot and plans for his house here in Palm Beach County, Florida. A government inspector found a six foot wide low-lying area on his lot that was muddy following a heavy rain. He declared the area a “wetland,” costing my friend over $30,000. The EPA is now seriously considering new regulations that would declare naturally occurring dust to be a “pollutant.” Livestock kicking up dust, dust raised in harvesting a crop, even driving a truck down a gravel road, could result in fines for farmers.

It was the Federal government that caused the mortgage meltdown in 2008. Starting with Jimmy Carter, and exacerbated by Clinton, Federal regulations required banks and mortgage companies to give mortgage loans to people who did not have the ability to pay them. The results were predictable – massive foreclosures and even more massive losses in the value of real estate nationwide.

The hostile Federal regulatory environment in the United States has caused thousands of small business to close down. They just don’t make enough money to pay the armies of lawyers to protect them from the government that large corporations pay. Yet small businesses produce the great majority of new jobs in this country. This attitude has filtered down to local governments.

In February, the city of Savannah ruled that Girl Scouts could not sell cookies on a public sidewalk. Ironically, this sidewalk was in front of the home of the woman who founded the Girl Scouts a century ago; the girls had been selling their cookies there for decades. A policeman in Midway, Georgia bullied three young girls who were selling lemonade from a stand in their own yard. He told them they had to shut down unless they got a license costing $50 a day. How many lemonade stands make even $10 a day?

Just cutting out the few things I have mentioned here would save billions of dollars. If we really got serious we could save trillions, but Obama isn’t interested in that. He wants to spend billions more, because he knows that stupid people will credit him with giving them our tax money and will vote for him in 2012.

If you are blessed with Conservative representation, tell them you are behind them and you’re praying for them. Tell them not to cave in to Obama’s threats. If you are cursed with Liberal representation, tell them in no uncertain terms that if they vote to raise the debt ceiling, you will do everything in your power to see that they are never elected to public office again. Tell them that not only will they lose your vote; they will lose the votes of all those you influence. Tell them you will not just vote for whoever opposes in the next election, you will donate to them and actively campaign for them. That should make them think twice about blindly following a failed president who has increased the National Debt by $4 trillion – a debt that your grandchildren will end up paying.