Pharos-Tribune

Opinion

January 2, 2013

KITCHELL: Avoiding “cliffs” should be permanent

There is a reason why congressional approval ratings are at an historic low and why statesmen seem to be leaving Washington just as highly-charged partisan warriors are belting it out in the Beltway.

Government in the United States has become more about who has more votes than who has the best ideas. Lost among all the wrangling is a deliberative debate over where we’re steering this country. For the past few months, we’ve been told we’re headed right over the edge, just as Christopher Columbus was told he would sail off the edge of the world.

Fortunately, it was not the case in Columbus’ case, and if we’re mindful of how a government should work and a country must function, it won’t be true in our case either.

What the debate over the fiscal cliff boils down to is this: Our country evolved in the 20th century into a land where the government incentivized ways to avoid paying our country in return for acceptable investment and behaviors that create a stable culture – home construction, college educations, retirement savings, nonprofit organization contributions and various other deductions. What we also did in the 20th century is deal with inflation. Those who remember the late Gerald R. Ford’s “Whip Inflation Now” (WIN) buttons remember the turning point in that battle. But when we whipped inflation, we also whipped wages, and with slow-growing wages and rising costs of living, government had the short end of the stick.

The solution to the fiscal cliff problem is simple: We have to incentivize ways to invest in the American government.

What does that mean? It means we have to do more things like offering long-term treasury notes known as T-bills that encourage Americans to invest in their country for the long run now, knowing they’ll receive interest later. It means we might consider incentivizing the tax code so that inheritance taxes are paid years in advance. It means we might have to think about income and corporate taxes like the post office thinks of “Forever stamps” – paying costs in advance so that we never have to pay the costs of postage later when prices are higher.

What that also means is that we have to play to our strength – our brand. If foreign countries believe in us and what we mean to the world, we have to provide investment instruments that are backed by the federal government.

It also may mean that if pay-as-you-go is the goal of Medicare or Social Security, that we calculate a maximum benefit for a lifetime. If an American doesn’t live long enough to collect that benefit, their contributions are used to pay down the federal debt. It’s maybe not the leading entitlement reform proposal out there, but it’s one of few that hurts no one in the process, except those paying into the system if the program costs exceed contributions.

Of course, all this doesn’t matter if we continue spending levels that are not fiscally sound. If Congress adopts unfunded mandates on future generations without attaching funding mechanisms, we’ll be back in this mess again several times over in the near future.

One final thought is this: For all the bitter struggles over the auto industry and financial industry bailouts, both have made money for the U.S. Treasury. GM stock went on sale at the end of 2012, and that company along with Chrysler has avoided the fiscal cliff that would have cost millions of jobs and an incalculable loss in reputation worldwide for the United States. The proposals would not have passed muster if there were not provisions that ensured the U.S. would be better off for ensuring their is a competitive auto industry in this country. And we are.

We just have to take that same kind of thinking back to Washington – and keep it there.

1
Text Only | Photo Reprints
Opinion
  • THEIR VIEW: Littering shows disregard for surroundings Numbers tell a sad story about the disregard many Hoosiers have for their surroundings. Too many in Indiana don't care enough about the environment to prevent them from cluttering the countryside by carelessly tossing litter along the side of roadway

    April 18, 2014

  • WOLFSIE: High-tech got you down? I love where I bank. It's a branch inside of a big supermarket. I can make a modest withdrawal and then go and blow every last penny in the cookie aisle. The tellers at the window appreciate me. They know about my obsession with round numbers and und

    April 18, 2014

  • PETERS: Grizzly bear may help human medicine I've gained 5 pounds since last summer. My body mass index (BMI) is still fine, but I need to stop gaining to keep it that way. Grizzly bears put my weight gain to shame. In the late summer, they eat some 50,000 calories per day and gain more than 1

    April 18, 2014

  • THEIR VIEW: Lawmakers fail to act on the issue After several years of fretting over Indiana's ongoing methamphetamine problem, the Indiana General Assembly continues to struggle for a solution. The issue seems to come up every session, given that Indiana leader the nation in meth lab seizures. Bu

    April 17, 2014

  • WILLIAMS: Feelings of the flowers I took one of those fun tests on Facebook to see what kind of flower I am and lo and behold, it said I was an orchid! That is so wrong because I have always thought I was the exact opposite of an orchid. I'd characterize myself as a daisy. You know,

    April 17, 2014

  • HAMILTON: Government as innovator? You bet! Five years ago, the federal government spent $169 billion to fund basic research and development. This fiscal year, it's down to $134 billion. People who believe in public belt-tightening applaud drops like that. I understand why: there are many reas

    April 17, 2014

  • PARKER: It's time to take a joke, America In selecting Stephen Colbert to replace David Letterman as host of the "Late Show," CBS has waged war on America's Heartland -- or so proclaims that Palm Beach font of heartland mirth, Rush Limbaugh. Don't you believe it, Heartlanders. But wait, ther

    April 16, 2014

  • THEIR VIEW: Constitutional convention won't work today There seems to be a growing idea that we need a Constitutional convention. That, of course, is the other way to change the Constitution. Amendments have been used 27 times to make changes, ranging from limiting the president's term of office to the d

    April 16, 2014

  • KITCHELL: Forum about adding answers, subtracting questions A week from tonight, Logansport residents and those outside Logansport who purchase electricity from the Logansport Municipal Utilities will have a chance to find out some things for themselves. A free forum at McHale Performing Arts Center will feat

    April 16, 2014

  • PUBLIC FORUM: The people are losing control of its government The people are losing control of government President Obama and progressive Democrats and Republicans are changing the landscape of our country by bypassing our Constitution and what our forefathers fought and gave their lives for. Their philosophy c

    April 16, 2014

Hyperlocal Search
Premier Guide
Find a business

Walking Fingers
Maps, Menus, Store hours, Coupons, and more...
Premier Guide
Poll

Should mushroom hunters be allowed to forage off-trail in Indiana state parks?

Yes
No
Undecided
     View Results
Featured Ads
AP Video
Captain of Sunken SKorean Ferry Arrested Raw: Fire Destroys 3 N.J. Beachfront Homes Raw: Pope Presides Over Good Friday Mass Raw: Space X Launches to Space Station Superheroes Descend on Capitol Mall Man Charged in Kansas City Highway Shootings Obama Awards Navy Football Trophy Anti-semitic Leaflets Posted in Eastern Ukraine Raw: Magnitude-7.2 Earthquake Shakes Mexico City Ceremony at MIT Remembers One of Boston's Finest Raw: Students Hurt in Colo. School Bus Crash Raw: Church Tries for Record With Chalk Jesus Raw: Faithful Celebrate Good Friday Worldwide Deadly Avalanche Sweeps Slopes of Mount Everest Police Arrest Suspect in Highway Shootings Drought Concerns May Hurt Lake Tourism Vermont Goat Meat Gives Refugees Taste of Home Calif. Investigators Re-construct Fatal Bus Cras Mayor Rob Ford Launches Re-election Campaign Appellate Court Hears Okla. Gay Marriage Case
Parade
Magazine

Click HERE to read all your Parade favorites including Hollywood Wire, Celebrity interviews and photo galleries, Food recipes and cooking tips, Games and lots more.