Default,” Dear Brutus, is not in our stars, but in
ourselves, that we are underlings.” Shakespeare might be annoyed that I
borrowed and corrupted his line from
Julius Caesar, but he’s dead. “Default” is the power word of the week as
statists scramble to coerce Congress into supporting an increase in the
national debt ceiling limit. The dirty truth is that default is not a
Constitutional option. Current monthly income for the federal government is
just under $200 billion. The primary obligation for the Treasury is to pay the
debt service first out of any collected proceeds. At current interest rates,
the monthly cost for interest on the $14.4 trillion obligation is slightly less
than $30 billion. In addition, the secondary Constitutional obligation is payment
of Social Security benefits due to the hypothetical, mythical “trust fund.” Those
payments run about $60 billion. It is clear, therefore, that the two
Constitutionally-mandated disbursements will leave a balance of roughly $110
billion in the Treasury for prioritizing other outlays and payments such as
military pay and civilian work-force payroll. The threats of impending doom,
and starving grannies are gross misrepresentations…..lies.

If, for any reason, Obama or Geithner delay the
Constitutionally-required disbursements for political purposes, they will be in
contempt and should be subject to impeachment. Whatever they choose to do,
legal or otherwise, the debt ceiling is a two-edged sword for the nation. While
it is true that federal cash flow is sufficient to satisfy Constitutional and
legal requirements, the massive size of the debt makes it politically difficult
to lower taxes enough to generate an economic boom. Some will continue to argue
that taxes must remain at present levels (or even higher) to raise funds for
debt retirement. Given the history of debt service in the United States, this
may be a bogus argument driven primarily by ideological considerations. No
principle payments have been applied to the national debt for 51 years, so it seems rather remote
that the government would feel compelled to pay down the outstanding balance.
Certainly debt retirement would be beneficial for the fiscal health of the
country because every uptick in interest rates would require billions of
dollars more from the budget.

The debt ceiling and the debt itself are constraining in
another way. It may create an artificial endorsement of the status quo on the spending side of the
ledger. The political class may perceive the debt limit as defining the outer
parameters of the spending matrix. They may convince themselves that as long as
they stay within the defined limit, their appropriations are justified and
defensible…no matter what the value, constitutionality or justification for a
particular program or line item may be. A similar concern is that with the
artifice of the debt ceiling in place, career politicians will be continually
seeking to increase or looking for ways to circumvent it. Pet programs
represent political promises for favored constituent groups. The political
class will be fearful of returning the government to its Constitutional
structure. They will fear the retribution of recipient groups who have become
accustomed to government benefits. Concurrent with addressing the debt crisis
and drastically reducing federal spending, the nation, people and politicians,
must unite for the “weaning of America.” We must insist and enable the drying
of the Nanny teat.

The kabuki dance that is taking place in Washington at this
time is merely a small beginning toward what must be done. Systematic and
reasonable spending reductions must be implemented to prevent a repeat of the
current fiasco. The cuts should be vertical
reductions with entire departments, programs and agencies being eliminated. Horizontal cuts are easier because they
will not generate the furious responses of the affected agencies and their
constituencies, but they are not effective and enduring. Merely shaving dollars
from the top of every aspect of government leaves the monstrous apparatus in
place to fight for restoration of money in the next and all subsequent budgets.
It might be useful (and proper) for Congress to become familiar with the
enumerated powers in Article 1, Section
8 of the Constitution of the United
States. Even if they ignore their legal limits, they may at least attempt
to fund only governmental functions that are relatively close to meeting
Constitutional muster. I can hope, can’t I? We the people should commit to
allowing some favorite programs to be cast aside if we are to work our way out
of this fiscal maze. Now is the time for that “shared sacrifice” that the
progressive-statists are so fond of demanding. Every American must be willing
to sacrifice some program or agency on the altar of budgetary sanity and
economic reality. Shared sacrifice, indeed, but I suspect the lefty crowd will
battle openly…and underhandedly every attempt to restore order to our nation’s
financial chaos.

Our situation is dire. Personally, I’m unconcerned if the
Chinese pass us as the preeminent economic power in the world. It suggests that
their billions of people may be on the cusp of experiencing some semblance of
individual liberty. I do desire that we put our fiscal house in order so that
liberty and prosperity will be available for all of our people. Default, dear
Brutus, can be brutal. Correction will be politically, economically and
socially disruptive. Each of us must be dedicated to the task. Et tu?

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