2012-10-31 / Columns

Jim Hite

What’s your foundation?

While the economy has been the main focus of this election cycle, its importance has never really been lost. Our nation’s fiscal health has a direct relationship to wealth and poverty.

Poverty, which stood at just over 22 percent of the population in 1959, declined to 11.1 percent in 1973, an unmatched low that marked the end of the “War on Poverty” and the subsequent retrenchment that continues to this day. We’ve seen a focus on freeing business from regulation in the Reagan years, the “It’s the economy, stupid!” focus under Clinton, which brought our last budget surplus and the collapse in the early part of this century from which we are now slowly recovering.

A few years ago, in order to keep prices from rising, manufacturers made containers smaller but did not change the price. For example, canned goods that were 16 ounces were now 15 or 14.5 ounces, soup cans 10 ¾ ounces, the old half gallon ice cream containers shrunk to 1.75 gallon, and so on.

It seems we’re in for another round. With Europe and the United States rocked by unemployment, rising prices, and lower incomes, Unilever, the Dutch consumer goods conglomerate, has attacked the problem by downsizing goods to make them affordable.

It’s an interesting approach to a fiscal problem.

But what should be a nation’s approach? What will solve the seemingly intractable situation in which we find ourselves?

The answer is not simple in spite of what sound bite you hear.

Calls to cut government spending have reached fever pitch, as have calls to lower taxes so spending can be cut.

But the question is: What to cut?

You’ve read and heard the platforms and politicians from both parties. No need to repeat here. But one item keeps coming to the fore—the increasing divide between rich and poor. According to Nobel-prize winning economist Joseph Stiglitz, the gap has widened exponentially for the past 30 years. One percent of Americans now control 40 percent of our country’s wealth, CEOs make 243 times a typical worker’s salary and the Walton family of Wal-Mart has as much wealth as the poorest 100 million Americans combined.

Stiglitz notes this not to attack the wealthy just because they are wealthy. He argues that the nation’s runaway economic inequality not only is inefficient but threatens to destabilize our economy and democracy as policies favor the rich and produce stagnant or declining wages for the rest.

Remember President Eisenhower’s warning about the Military Industrial complex? Let’s look at military spending. According to the Stockholm International Peace Research Institute, for fiscal 2012 the U. S. leads the world with $711 billion. Next is China at $143B, Russia $72B, the United Kingdom $63B, and France $62B. For the United States, that $711B is about half our nation’s budget.

Again the question: What to cut?

A nation’s spending displays a nation’s priorities. Whether one considers those priorities good or bad, moral or immoral, necessary or unnecessary is an individual decision. That decision can be emotion based, it can be faith and Scripture based, it can be selfishly based, or it can have some other foundation.

Be honest. What’s your foundation?

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