The old Bobby Bare song, Detroit City, has a refrain that centered on the desire to “go home.” Unfortunately, everywhere else is turning into Detroit City. Pretty soon there will be no home to go to.
Detroit’s bankruptcy, announced yesterday, gives us an opportunity to go over a few fiscal realities, always a good idea if you are careening toward a whole series of fiscal reality checks.
The first thing we must grasp is that we are dealing with levels of municipal debt, state-level debt, and federal debt, that mean a necessary default is coming. If our problems are left untended, we will default. If we wake up in time, and address the pending problem, we will default. This is another way of saying that every genuine solution to the problems created by our fiscal irresponsibility will be a form of default. The only solutions now are defaulting solutions.
The only thing we don’t know is what kind of default it will be. The only thing we don’t know is who the unlucky victim of our defaulting will be.
Government does not make wealth. If government has wealth, then this means it was taken. The only way that the government can acquire the means to pay its obligations and debts is by taking it. The only question left before the house is “who will they take it from?” There are a limited number of options.
When a politician says that we cannot allow our government to default on its solemn obligations, he either believes what he says, and is a fool, or he knows what he is saying is false, and wants us to believe that we must avoid Default A, which is what he is really talking about, and must select from defaults b, c, d, and e, which he does not really consider defaults “technically,” because the people who are going to get hosed by them are not part of his constituency.
The government does not make, and in order to have, must therefore take. Here are the basic ways in which such a taking can happen. The government can wage war on other countries, and take from them. The government can raise taxes, and take that way. The government can debase the currency, and take that way. The government can run up a big debt which it finds itself unable to pay, and take that way. And of course, given the realities of the ongoing political circus, the government can stagger between these options, like a drunk trying to make it to the next lamp post.
Beware of those reforms that hide the reality of the defaulting. Those kinds of reforms are probably the best way of proceeding, but only if they are honestly embraced as the least destructive way of defaulting. But don’t hold your breath. The government lies. The government cheats. The government welshes. The government steals. The government defaults, and hides it.
For example, if the retirement age for Social Security is extended by two years, this does make the program viable longer on paper. It does this by unilaterally changing the terms of a contract — by defaulting. It may be better than doubling down on the current lunacy and having the whole thing go up in a sheet of flame, but it is not better because it isn’t defaulting. It is just as much a default, but it may be less damaging to the recipient.
If you pay your creditor 50 cents on the dollar, that is a default. It does less harm to him than paying him 10 cents on the dollar, which in its turn is not as bad as paying him nothing at all.
Detroit is now defaulting on its bond holders, its pension holders, et al. Look at it straight on — it is hard to make out, but a line has formed and we are trying to make out who is next. Is it California? Illinois? New York? There are municipalities in there too. And if this spectacle becomes too grim, and a demand arises for the federal government to “do something,” this will just be an example of people opting for the coast-to-coast sheet of flame default, instead of the piecemeal approach.
One last thing. I would like to address a few words to those evangelicals who have been seduced by leftist economics, or who are in some way flirting with leftist economics. You may have cannonballed into the deep end, like Jim Wallis, or you may just be sidling sheepishly in that direction, with some cover provided by distributist literature. You think that the language of compassion is more biblical, and the idea of communitarian sharing makes you feel warm all over. You think that businessmen who know how to add and subtract are those who are in the grip of mammon-lust. You don’t like the hard lines of clear thinking, and the blinking sums on their calculators do nothing but harsh your mellow.
Do me a favor, and look at Detroit. Look at the failure of all the compassionate nostrums. Look at the collapse of real integrity. Look at the grasping and demented idiocy of the unions. Look at the abandonment of government’s true functions. Look at the wreckage of human lives. Look at the ruin of a once great city. Look at what aching greedlust does. Behold the handiwork of your compassion.
Look at what mammon in sheep’s clothing can do.
Just watch, somebody’s gonna blame the entire thing on MI’s new right-to-work law.
Many Tribal governments do create wealth by running tribally owned businesses. Many of them reinvest the profits into their communities. On many reservations life hsd gotten better for people. Sure, there are a lot of bad business models on the Rez, but a lot of good ones too. Why couldn’t cities do something like this?
The Mexican government also creates wealth from the oil industry, which they nationalized. But I think even that example would still make Wilson’s point since that generated wealth is based on a previous taking. However, there probably is an exception in the form of state run lotteries. These are not a direct taking from the people, since they are voluntary. Though predominant, I’m sure Robert is not simply referring to casinos when he says “tribally owned businesses”, but the problem with the gambling industry is that it really doesn’t scale well beyond the portion of the population that isn’t good… Read more »
When reading the last paragraph Charn came to mind.
“Look at the failure of all the compassionate nostrums.”
They have, and still return to the mire. They are (courtesy of Mark Steyn) saying that the blame for Detroit is due to the “wealthy” leaving Detroit and so all that is left is “the poor”. Per Steyn, the “community organizers” never want to live in any community that they have “organized”.
Are you SURE you’re not pre-mil? :-)
One of the sadder consequences of this whole leftist economic web we’re stuck in is that many aspects of the economy and employment proper become literally dependent upon the system. Because of this, effectual necessary austerity measures usually cause economic downturns in the short run. It can take years to get a vibrant private economy into full gear – and political patience is required to see the fruit. The only hope to avoid the worst case scenarios is for State-dependent democratic societies to patiently outlast the painful process of austerity, hyper-regulatory disintegration, privatization, etc. Since our culture has reached the… Read more »
Are you SURE you get postmil?
Fortunantantly, America’s demise has nothing to do with whether someone is post-mil. Augustine wrote “City of God” because Christians of the day attached a particular nation to the cause of God’s kingdom. But Rome fell (for a lot of the same reasons America is in danger of falling), and yet the church lived on and grew. And many hundreds of years later Christendom has flourished world-wide, and the wreckage of Rome no longer stumbles Christian’s eschatology. Neither will or should the wreckage of Detroit or even America.
A few years ago two French photographers took a series of photos they entitled “The Ruins of Detroit.” They are the perfect visual accompaniment to this post. http://www.marchandmeffre.com/detroit/index.html
…now a judge has declared that gravity no longer functions. This would be humorous if it weren’t tragic.
Here’s a better link to more of the Ruins of Detroit photos. http://www.weather.com/travel/modern-ruins-abandoned-detroit-photos-20130715 They’re haunting and powerfully capture the trajectory we’re on.
Just excellent. Cannot help but wonder how my r2k friends cannot see this piece as a righteous, godly example of how the Lordship of Christ is manifest over economics and politics. I mean who could either a. disagree and say, “None of this really matters. Word and Sacrament after all, not people, even poor pensioners, having their wealth taken” or say b. “Well yes, Doug is right, but only because of natural law. The BIBLE doesn’t speak to our speaking to this.”
My father in law relayed a story to me recently in which a bored substitute teacher decided to lecture his (then) 5th grade class on the principle of “Pay now, or Pay later”. Would that this substitute teacher could have been mayor of Detroit.
Kirsten, those are powerful images. Here’s a clickable link. Also this.
It is good to see these kinds of photos circulating internationally through the interwebs, so that the kings of the earth can see through the pretense, see the other America, and take warning. Let them be on guard and suspicious when we arrive to make their nation “safe for democracy”. They will be able to see that we lie when we say that it was “democracy” that was responsible for our former blessings. The wicked shall be turned into hell, and all the nations that forget God. For the needy shall not always be forgotten: the hope of the poor… Read more »
Government only takes? It doesn’t make wealth? Maybe in a certain way of thinking. But think about how much wealth would not have been created if the government hadn’t, for example, built the interstate highway system. Or the Internet. I presume that private business would have done great jobs on those without the involvement of pesky government. Me and my foolish leftist ideas. Detroit is an extreme example of a certain type of foolishness, no doubt about it. At the opposite end of the spectrum are the economies of my native South, where laissez-faire economics has left a seemingly permanent… Read more »
Pastor Wilson speaks volumes when he says that government can only take. It cannot give anything to someone (food stamps, expressways) unless it has first removed the money for that “gift” from someone’s pocket. What “good” are Detroit’s many expressways now, except avenues of escape? What good is the Internet (not built by “government”, I’m afraid, or it would operate like the USPS), except to find a home elsewhere. No one complains about paying that (tax) money for useful government services; at times, even for war (though that is a stretch). But everyone needs to understand the rules: government provides… Read more »
Kirsten, in looking at those photos of Detroit, I saw a pretty poignant shot in #6. In a ruined church building, there was a large sign across the wall that says, “And You Shall Say God Did It.”
Very appropriate. Judgment is real, on many levels.
“For example, if the retirement age for Social Security is extended by two years, this does make the program viable longer on paper. It does this by unilaterally changing the terms of a contract — by defaulting.” Not so. SS is not a contract, it is a wealth transfer scheme that collects money from the currently employed and their employers, and transfers it to retired workers and the spouses of children of deceased workers. The terms of the tax collection and the distribution are both “subject to change” at the discretion of Congress at any time. A court case brought… Read more »
Jay — It was also not terribly unhappy to notice that one of the abandoned sanctuaries was a Unitarian church.
If Obama had a city, it would look like Detroit.
Jim Wallis is to blame for Detroit? Compassion is to blame for Detroit? I think not. I invite you to read https://www.facebook.com/RBReich for a rather different explanation of the city’s woes; or, for that matter, try reading Charlie Le Duff’s fine book DETROIT, which makes it clear that there’s plenty of blame to go around. By the way–it’s absolutely true that “the language of compassion is more biblical,” and that compassion is the antidote to the “aching greedlust” you properly decry. As to “The government lies. The government cheats. The government welshes. The government steals. The government defaults, and hides… Read more »
@Jack – of course there are bad corporations, but they don’t have a gun pointed to my head forcing me to buy their product, and if they welsh on a contract or steal, then they can be sued and run out of business. We have no such recourse with government. In fact, when government does those things, the answer is usually to give the government more money to “solve” those problems.
Jack Shifflett seems to have missed the point. Doug is not speaking against true compassion at all. Rather Doug is speaking against what has been done in the name of compassion, but which has resulted in greater oppression and damage. The road to Hell is paved with “compassion”. This is not about anti-government anarchy. It’s simply about returning the government to its proper sphere. The government bears the sword as minister of God’s wrath, they do not bear the arms and hands of compassion and charity which have been given to the Church, supplied from God’s tithe. Our government is… Read more »
I found this article by the author quite interesting until I realized he was a Pastor and most comments were from religious points of view, which I also found interesting. But how ironic it is that the Pastor speaks of how the government “takes”, and it is apparent he is referring to monetary taking. Really? And the churches of the world do not “take” Pastor? Last I heard the tax exempt status of most churches across America seemed to keep Pastors and Priests and most clergy in very comfortable, and secure, houses, with admirable social status, and mostly for the… Read more »
The timing of folks like Lenore is comically upsidedown. Of course the Vatican is a perennial target for the accusation of hoarding of wealth, but Lenore speaks to us as if we should feel guilty about what Rome is doing when we Protestants were kicked out for objecting to this very kind of abuse centuries ago. Someone needs a history lesson. Lenora is late to that party. As far as the charge of “taking”, Lenore will have to explain that one. The Church has no authority to confiscate in the manner of the civic magistrate. The tithe to God’s Church… Read more »
I appreciate and welcome the reply Katecho. First, I lay NOTHING on Jesus Christ. I think my original comment to the Pastor was cynical, as I hinted at, because I was surprised that the discussion of government “taking” would be so contemptuous from a religious person of the cloth. His comments about how the government does not create wealth and only “takes” from the people who do are interesting yet simplify a very complex situation. Since religious institutions are based on the same “giving” and “taking”, I thought his commentary was ironic. And you have to admit that the Vatican… Read more »
Lenore wrote: Since religious institutions are based on the same “giving” and “taking”, I thought his commentary was ironic. It seems Lenore has chosen to ignore the reminder that Church giving is 100% voluntary. Repeatedly calling it a taking won’t change reality. The Church is not the IRS. Lenore continues: The government “lies” the Pastor writes, and “businessmen”, who of course never lie, have calculators of reality. Let’s blame and trash “liberal” “compassion” and the “greedlust” of the unions. The Pastor doesn’t seem to think that the corporations who sucked the life out of Detroit and took their spoils to… Read more »
“It seems Lenore has chosen to ignore the reminder that Church giving is 100% voluntary. Repeatedly calling it a taking won’t change reality. The Church is not the IRS.” There but for the “taking” through tithing do clergy exist. That is a fact. The govt may “take” through the IRS for it’s sustenance, but rest assured, the clergy “takes” from tithing. Again, the Katecho distinguishes the Evangelicals from the Vaticans and from the Televangilists and then from the greater worldwide Christian community, of which, by the way, I am very much a part of. Church giving is voluntary, and so… Read more »