Politicians create catchy names and word pictures to undermine
economic ideas they dislike. Jesse Jackson disliked
"Reaganomics." Ross Perot described the relocation of jobs to
Mexico as "the giant sucking sound."
America's insane spending policies of both major political
parties have been renamed by me as "Newmanomics" in honor of
"Mad Magazine" way too cool cover guy Alfred E. Newman. His
mantra: "what, me worry?"
Not only do many American people, companies, and government
officials spend like drunken sailors, some blame "foreigners"
for our plight.
Having some alcoholic relatives, I understand how denial works.
Denial is simply self-deception.
Can't we blame China? After all, they consume 382 million tons
of grain compared to 278 million tons in America annually. China
uses twice as much steel as we do. China uses 800 million tons
of coal to our 574 million tons annually. China oil imports are
up 34%.
Since China has 1.3 billion people, and we have about 300
million, China consumes less on a per person basis than us.
Moreover, China is rapidly transforming itself into a modern
superpower. We can't blame China for our woes.
Our problem is not China, India, Japan, South Korea or any Asian
bogeyman.
As Pogo says, "we have met the enemy, and he is us." The USA is
not a victim of anything or anyone external.
We've bought Washington's "Newmanomics" bunk hook, line and
sinker. Therefore, "what, me worry?" is our vote-producing,
bipartisan, nonsensical consensus economics doctrine.
You see, as disciples of "Newmanomics," we can always print more
money, sell more debt to Asian nations and banks, increase taxes
on the "rich" (anyone making a dollar a year more than we do),
and give tax breaks to industries contributing to last year's
elections.
Excessive debt--public and private--is weakening the US Dollar
and the American economy.
US Government debt stands at $ 8.00 trillion, which increases a
mere $1.76 billion daily. That works out to $26,222 of federal
government debt per American man, woman and child.
At least $2.0 trillion of our U.S. government debt is held by
persons and institutions in other countries.
If they begin to perceive the US Dollar as weakened, they can
refuse of buy more US debt instruments and/or demand higher
rates of return, possibly setting off a spiral of inflation here
at home. American corporate debt increased by $1.0 trillion in
the last five years to $5.2 trillion.
$453 billion of Ford and General Motors corporate bonds (a form
of debt) have been downgraded as "junk bonds." Their value is
likely to erode speedily and sink like a heavy rock.
This $453 billion is 15 times more than the bonds involved in
the WorldCom meltdown.
Personal household debt averages $101,445 per American family.
Finally, these debts do not include those of states and
municipalities, underfunded private pensions, government
pensions, and totally unquantified, underfunded, almost eternal
liabilities of Social Security and Medicare.
Americans have always risen to the challenge and found new ways
to make more money as circumstances change and new opportunities
arise.
Alfred E. Newman is right. Worry is useless. In a shaky economy,
build your own business and manage your own money.
About the author:
John J. Alquist is a professional speaker, author and busines
consultant. He is a powerful champion of almost universal
self-employment. His company, Alquist Enterprises, advances
self-employment in a multiplicity of ways.
Find him on the Internet at:
www:tell-it-well.com
