August 23, 2011 by David K. Sutton
A Historic Opportunity
If you tune into the news networks – with emphasis on Fox News – you are eventually going to hear a talking head say that businesses and families need to control their spending and so that means government does too. What they seem to imply with those sentiments is that the United States government shouldn’t take on debt or at the very least shouldn’t take on the amount of debt that it has to date.
I don’t intend to make a case for or against the idea that the U.S. has too much debt. The case I do want to make is that you cannot equate the finances of the federal government with the finances of a business or a family. Never mind that both of those entities take on debt as well, but businesses and families are concerned with the welfare of the business or the family and not the entire nation. The reason they are not equitable is that the government – as stated in the preamble to the U.S. Constitution – has the duty to promote the general welfare. In a time of economic hardship if the government needs to spend money to stimulate job growth in the economy to promote the general welfare then it should do so. To not would be failure to adhere to one of its basic duties as stated in the Constitution.
Families and businesses typically cut back on spending during an economic downturn which only serves to expand the downturn. Families cutting back means less consumer spending which means less demand for products which leads to job losses. Businesses cut back on spending because they aren’t making as much money. One of the methods businesses will use to cut spending is layoffs. What could reverse this cyclical trend?
Government is the one entity in this equation that can buck the trend. Government has the dexterity to deficit spend to stimulate the economy. This can come in a lot of forms but one of the best forms is projects that not only create many jobs but also benefit the entire nation for many decades to come. The most obvious area to focus on is infrastructure. We are talking bridges, roads, electric grid, power plants, etc. With a decade long initiative, millions could be employed and dramatic improvements could be made to our aging infrastructure that will benefit both the public and private sectors for the next century.
We have a historic opportunity to significantly shape the future of this country. Interest rates have never been lower and construction jobs have taken a big hit in this economy. We have countless infrastructure projects just waiting to happen and millions of Americans eager to get to work on them.
Will we really let this moment slip away?