Monday, January 19, 2009

Something for nothing

My daddy taught me a long time ago that there is no free lunch. You just can't get something for nothing in this world.

Governments embrace Keynesian economics because we all want to believe that we can get something for nothing. That all we have to do to cure any problem is print money or hit a computer key nowadays.

I can see it in the hope on peoples faces as Obama promises to fix all of their problems. They want to believe in magic.

How is he going to do it? With a stroke of the computer key of course. It doesn't really matter that the US is technically broke. The theory is that we can rectify that by simply printing more money and creating more and bigger debts.

Let me ask you a question. If you were broke and couldn't pay your bills does it really help you to get another credit card and max it out? When you do max it out does it really make sense to repeat the process again and again?

Well that is exactly what the US is doing. If it doesn't work for an individual why should anyone think it will work for a country?

The downside is of course if an individual does this he eventually takes down not only himself but any credit card company that was dumb enough to give him credit .

The scary thing about the big picture is that the whole world has been issuing credit cards to the US. Not only are we spending ourselves into bankruptcy but we are now trying to take down the rest of the world along with us.

At what point do we accept the fact that we really can't get something for nothing? When does it finally dawn on us that we can't keep spending trillions of dollars in a fruitless attempt to avoid taking our medicine? And when do we realize that the longer we avoid taking that medicine the more bitter it becomes?