KENNEBUNK — A subprime housing bubble, an unrelenting recession and dysfunction in Washington have created an electorate that, while increasingly anxious about the direction of the country, remains a desperate true believer in economic recovery and political renewal.

For the reasonable, there’s a disconnect between this hope and eco-political reality as evidenced by the following summaries of five key problems that define America’s direction, followed by a suggested solution.

Employment and recovery: The official unemployment rate is 7 percent, but the actual number is at least three times higher because it doesn’t include part-timers and temporary employees, discouraged workers and the unemployed who’ve exhausted their claims.

The state of full-time employment and retirement isn’t much better. Benefits have been cut or lost altogether.

While the middle class is shrinking, the American dream is fading and the social safety net is under assault by cutbacks in food stamps and long-term unemployment benefits, income inequality is growing.

This new American economy isn’t a Democratic or Republican fix away from robust recovery. On the contrary, there isn’t a single bold idea between the parties to revitalize the economy. What works for Washington and Wall Street is in danger of making Main Street an endless strip mall of low-paid service employees.


Debt and deficits: Deficit spending has quadrupled sovereign debt to almost $17 trillion in the past 20 years and will continue to grow at an alarming rate.

Yet, despite trillion-dollar deficits, Keynesians ignore the rapidly rising annual interest cost, which was $242 billion in fiscal year 2012. With artificially low interest rates certain to rise, this cost is projected to be the largest item in the federal budget in 2020 at $778 billion.

Washington’s recent budget deal is a sham because, while it suggests that government by deadline has been replaced by a new era of compromise, it’s simply a recognition by both parties that increasing debt is less politically risky that shutting down the government again.

The Fed and Wall Street: The Federal Reserve has made the U.S. a currency manipulator by tripling the nation’s money supply in the past four years and encouraging Wall Street to engage in increasingly risky behavior that’s creating a new stock market bubble.

Even without the Fed’s extreme intervention, Washington has long pursued public policies that have enabled Wall Street to prioritize short-term profitability at the expense of long-term investment and innovation. These policies accelerated the decline of the U.S. from being the only post-World War II economic superpower to becoming the world’s most indebted nation.

Political paralysis and dysfunction: Working at the margins of problems without actually solving them is how Washington operates. It’s evidence of what bureaucracies do best: perpetuate problems with short-term fixes.


However, a country with trillion-dollar annual deficits, even if those deficits are cut in half, can’t pay an increasingly larger slice of the federal budget on ballooning debt interest or afford massive waste, tax cuts to the middle class, uncontrolled defense and foreign aid spending, and delayed reforms in entitlements, taxes, and other areas.

With the dominance of the political parties vis-a-vis individual members, solving problems will always be a distant second to the merry-go-round of winning control of the White House and Congress.

Voter ignorance: Thomas Jefferson warned that nothing is more vital to democracy than an informed electorate. Yet, while politicians routinely pay obligatory homage to the intelligence of voters in an era dominated by hundreds of issues and an overwhelming amount of information, statistical evidence of a poorly informed electorate actually dates to early scientific polling in the 1940s.

This contradiction between pacifying myth and reality explains the political vacuum in which Washington operates with illusionary and not real accountability.

A nonpartisan plan to revitalize America: With mathematical certainty, these problems are leading inexorably to catastrophic default and severe austerity. They show the extent to which voter confidence is misplaced in a two-party system that substitutes blame, buzzwords and cliches for credible vision, compelling strategy, big ideas and political will.

Far from being demoralizing, these problems should be a wake-up call for voters to demand what the country desperately needs – an honest, clearly defined and comprehensive plan to revitalize America.

An idea to develop such a plan is for voters to lobby their elected representatives to create an independent national commission to conduct televised hearings to address a variety of liberal, conservative, libertarian, populist and other proposals to eliminate waste, cut unaffordable spending, reform entitlements and create economic growth.

— Special to the Press Herald

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