Common Myths

Public Debt: We buy cars on credit. Rarely does a consumer have $30,000 or 40,000 sitting around to plop down on a new car purchase. We arrange auto loans for this purpose. We trade in the old car, add some cash maybe, then the balance is carried by a loan for so many 100’s of dollars per month. Financed properly, the payments are painless, automatically deducted from our bank accounts and we hardly notice the cost. Same with buying a home. Mortgages are big deals in our economy. Even corporations buy property with mortgages or debt instruments of some kind.

So does government. Municipal, county, state or federal, our government units buy a lot of goods and services in the name of the public. Not all of these are paid for with current cash. Big ticket items are bought through negotiated debt instruments. That is what a treasury bill or bond is. It is federal government debt financed by individuals, investor organizations and financial institutions. We buy bonds, earn money, and know the government will pay us back what they owe plus interest. We know this is true; we trust it.

Highways, bridges, a dam, or public school building, these are big ticket items. They are paid for with debt instruments in the main. Their costs are amortized over months and years, and current cash accounts are debited accordingly. They are paid for bit by bit just like our mortgage or auto loan payments.

In the end, public debt is what we owe to ourselves as a nation. A debt ceiling is a management concept and not a real barrier. It was normally not a problem. In recent decades politics has manufactured the debt ceiling as a major public issue. It is not. We should be conscious of our public debt and how best to manage it, but there is no policy, rule, regulation, or law that tells us what to do. It is political nonsense made huge by people who pretend to be in power. Know this and ignore them. This will strip them of their self-importance. This is just another case where the emperor has no clothes.     

Mandates are Bad: law is mandate. We do something or we pay the penalty of not doing what has been legislated. Some mandates are imposed by executive authority for jurisdictions involved in the matter. Restoring order to a local school is the province of administrators of the school; they may request assistance from local law enforcement resources, but in the main the administrators have the authority and will of the public to keep the school safe. We follow those mandates. A mandate from a governor or President regarding public health and safety, is another example of a request that has the force of law. It is a matter that is for the common good. Cooperation builds safety and better health.

That is what the vaccine and face mask mandates are in a health pandemic. If one is ill, the health threat will spread to others. Who and how many remains an open question; the consequence of noncompliance is apparent. We even have statistics to prove it. Reasonableness is established and we conform to the mandate.

Failing to do so breaks the public’s contract with itself. Not a good thing, these people should isolate themselves from others to protect the common good. That is how this works. For everyone.

Compromise is Weakness: coming to an agreement on something where total unanimity is not present, is called negotiation and consensus. There is general agreement that something should be done, just not what that action ought to be. Negotiating will help find a way that is less onerous on one party while achieving the end for the common good all agree on. Compromise is a must in a complicated world where opinions multiply and diverge. Compromise keeps institutions and governments working. Maybe not perfectly but functioning as we need them to.

Celebrate compromise. Eliminate the all or nothing mentality common in today’s legislative bodies.

October 12, 2021