Saturday, April 21, 2012

A Depressing Economic Forecast

Texas congressman Louie Gohmert, for whom I have a high regard, was among those representatives who appeared at the Heritage Foundation to express misgivings regarding the [Wisconsin congressman Paul] Ryan plan’s timidity. They’re not wrong on that: The alleged terrorizer of widows and orphans does not propose to balance the budget of the government of the United States until the year 2040. That would be 27 years after Congressman Ryan’s current term of office expires. Who knows what could throw a wrench in those numbers? Suppose Beijing decides to seize Taiwan. The U.S. is obligated to defend it militarily. But U.S. taxpayers would be funding both sides of the war — the home team, via the Pentagon budget, and the Chinese military, through the interest payments on the debt. (We’ll be bankrolling the entire People’s Liberation Army by some point this decade.) A Beijing–Taipei conflict would be, in budget terms, a U.S. civil war relocated to the Straits of Taiwan. Which is why plans for mid-century are of limited value. When the most notorious extreme callous budget-slasher of the age cannot foresee the government living within its means within the next three decades, you begin to appreciate why foreign observers doubt whether there’ll be a 2040, not for anything recognizable as “the United States.” 

Yet it’s widely agreed that Ryan’s plan is about as far as you can push it while retaining minimal political viability.

-Mark Steyn in "The Sun Also Sets" in National Review Online about a month ago.

Doubtful that we would be on both sides of a war with China, as Steyn proposes, tongue in cheek.  War with China itself, however, arising from our becoming crippled with debt, is certainly not out of the question.  Is that the ultimate solution to the debt crisis?  I doubt we would be treated as gently by China as Greece by Europe.  We might certainly be as weak, relatively speaking, at some point.  No one talks any more about our economic strength being a matter of national security.  The discussion seems to be always about funding entitlements.  How completely self-involved we are!  (It reminds me a little of how the unions drove Eastern Air Lines out of business (and their members out of jobs), rather than reduce salary and benefits.)

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