Defaulting On The Debt Is Our Only Option

On Monday, while displaying his characteristic self-righteous indignation, the law professor turned community activist turned President told the American people that Republicans are solely responsible for “their” fiscal crisis and “they” will have to continue to spend “their” way out of “their” mess. Obama laid down the law during his press conference and demanded the power to explode our debt ceiling to service the American people that re-elected him last November. Or else.

“We must pay our bills.” We must act responsibly.” “The American people agree with me.” -Barrack Obama

Our chief executive officer (Obama) just told his investors (taxpayers) that he will continue to pay for his 2012 election mandating plan to expand the nanny state by raising the debt ceiling and authorizing the confiscation of our wealth, income and prosperity to be redistributed to people that vote Democrat. Meanwhile, he is going to continue his scheme to add a few more million government dependents (or Democrat supporters) every quarter, destroy a few amendments to the U.S. Constitution and continue to blame all failures on the Republican Party and conservative agendas.

Looking back in time to 2007 and 2008 and the crisis that led our government to spread the fear of economic collapse and gain support for bailouts, I find stark similarities in today’s White House rhetoric. Much like TARP and the Stimulus measures—that were our only means of averting an economic catastrophe— now Americans are expected to believe that uncontrolled spending and blowing up our short term national debt is the only way to sustain our current economic position. Which, by the way, they told us was unsustainable.

There are those among us, myself included, that belief that bailing out our nation’s financial community was a horrible decision. The economic calamity that would have befallen our nation would probably not have been much worse than what we are currently dealing with, with a few exceptions. One being our national debt would not be working its way to 20 trillion dollars and our financial communities would not have been empowered to continue to break the laws conveniently ignored by our government. Two, Americans would not be sacrificing our Republic and liberty for the temporary security of promised long term government handouts. In other words the collapse that we avoided would have been less expensive for taxpayers and more politically expensive for our elected officials and their campaign benefactors.

While our government grows the entitlement class and demonizes those among us that live within our means—shouldering the financial burden for our personal successes and failures— our demands for fiscal restraint go ignored. Not just ignored, but shaped as the cause of our economic stagnation and loss of jobs. Yes, somehow productive Americans are about to be blamed for the coming economic downturn rational people know is coming.

So what would be so bad if the government defaulted and couldn’t pay its bills? What world shaking calamity—just like the one they threatened would happen in 2007—would we experience if we don’t go along with the Democrats current agenda of more spending? Does anyone think that our economy would collapse or just reset? As the primary source of government revenue, productive taxpayers must ask themselves if a financial collapse is preferable to the systematic confiscation of our hard earned wealth and income. I would argue that government default is a better option than many Americans think.

There is a lot to be said for an out of control government defaulting. If you can’t borrow and print money everything changes for corrupt politicians. Number one, in my mind, is that this spending behemoth that is bankrupting our Republic would have to reduce its size, scale back its spending and get out of the winners and losers business it has been in for almost 5 years. Think about what we could do with a weakened federal government?

I would also argue that it could have an enormous positive cultural effect. Americans would have to become more reliant on their families, churches communities while they weathered the storm. Just as Americans did during the Depression; the economic disaster that created the greatest generation of responsible and unselfish people this world has ever seen.

I know, I know, it would be a disaster for a decade or so, but what in the heck do you think is going to happen when this house of cards we are currently paying for comes crashing to the ground? If we continue—down the path prescribed by Obama and Democrats— we will eventually arrive at exactly the same place, it will only be more expense and costly to again attempt to dig ourselves out. I would argue that it could lead to an American cultural revolution of sorts. A dismantling of the entitlement addicted society that is destroying Democracy.

As it is today, there are no balanced approaches to recovery. Even the Republican ticket of Romney/Ryan was looking 20 years down the road before our fiscal house was back in order. So do we wait or tell them to crash it now? I’m for now.