Maria Antoinette’s life with Louis XVI was marked with frivolousness and extravagance; it was also attributed as a factor bringing France to the throes of financial disaster. Fair or not, she became known as Madame Déficit and was publicly beheaded at age 38.
Life expectancy has grown since 1793, if only for lack of guillotine usage. No matter the economic condition of the nation, I doubt beheading will be reinstated. So, here’s to you, Mr. Obama – Happy 48th – and ten years longer than Mrs. Antoinette.
To celebrate, it may be sweet to reflect upon (or revel in) McCain’s concession: “the stimulus has had some effect.” Perhaps that’s the icing?
But as shortsighted and forgetful as Americans can sometimes be, sometimes the obvious needs to be stated: pumping trillions of dollars into the economy will affect it. Pumping trillions of dollars into *anything* will do *something*.
The ultimate question remains: what is the long term impact of these decisions? Let’s be real – contrary to what some politicians might imply – money does not grow on trees. And while printing new money does seem fun (“Look ma’ – a crisp dollar!”), it’s no fun when the negative effects are felt years down the road by the next generation.
Let’s consider the short term impact. Jobs will be created. People will spend. The Cash for Clunker system aptly exemplifies this (“Look ma’ – car dealerships are making great money again! We’re saved!”). But unless lasting, long-term changes are made, we’ll end up right where we started (“Ma, the Cash for Clunker system ran out of money! Ford needs help). No doubt, Ford needs help. Giving them money without addressing the problem leads to failure. C’mon folks – you don’t need to read tarot cards to figure this out.
In a more drastic, albeit tangible example, Oregon invested an additional $176 million into the state to create over three thousand new jobs. The catch: these jobs lasted a week. I’m not here to debate the finer points painted by the Obama administration. Whether the jobs “created or saved” last a week or a year is largely irrelevant. My point is this:
Present artificiality does not equate future reality; but future reality will reflect the consequences of short term stimulus.
Someone, somewhere down the road, will pay for the trillions we are spending today (“Ma, am *I* going to pay for this?”). Future generations will feel the reverberations: higher interest rates, inflation, less available tax revenue, and a declining American dollar.
But we can worry about those problems another day; today is a celebratory time, right? I’m waiting for the announcement, “qu’ils mangent de la brioche.”