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October 08, 2008

Tackling Our National Debt

Americans finally realize that debt has its limits. Inevitably the day comes when the creditor demands payment — and that day seems to be today! We are inconveniently being reminded of the plusses of budgets, savings, and investments juxtaposed with the minuses of lying (ethics), cheating (cooking the books), and greed!

A few thousand years ago, we were given plenty of guidance on how to avoid the financial Armageddon we see happening before our very eyes! Listen carefully to the Old Philosopher's straightforward recommendations and warnings that even I can grasp, having no idea what hedge funds consist of or how they spread terror around the world.

"Wealth obtained by fraud will dwindle, but whoever earns it through labor will multiply it" (Proverbs 13:11).

"Truth stands the test of time, lies are soon exposed" (Proverbs 12:19).

"Ill-gotten gains do not profit anyone, but right-doing rescues from death" (Proverbs 10:2).

"A greedy man is in a hurry for wealth, he doesn't know that poverty will come to him" (Proverbs 28:22).

"When people do not accept divine guidance they run wild. But whoever practices the law is happy" (Proverbs 29:18).

"The person who runs to get rich quick will only get into trouble" (Proverbs 28:20).

"Better a poor man who lives with integrity than a rich man who distorts right and wrong" (Proverbs 28:6).

"Dishonest scales [dishonest printing press money?] are detestable to the LORD" (Proverbs 11:1).

"Honest balances and scales are the Lord's; all weights in the bag are His concern" (Proverbs 16:11).

"Silver is tested in a crucible, gold in a smelter" (Proverbs 7:21).

Enough wisdom? Enough Economics 101? Too much Bible — an old book that has been rendered obsolete by modern scholars and scientific experimentation? Really?

This wisdom of the ages cries out to our contemporary predicament, but who can admit it without being considered Neanderthal or worse? A Harvard MBA is considered sacrosanct, but even the Wall Street Journal (Sept. 17, 2003) wrote, "In the post-Enron era, MBA programs — Harvard in particular — have come in for some caustic criticism for producing graduates obsessed with making money regardless of the ethical consequences. To some people, MBA graduates are at the root of all the corporate greed and dishonesty. In a public-opinion survey about how companies can mend their reputations, one respondent declared, 'Get rid of the Harvard MBA's.'"

Unbalanced budgets simply mean we're living beyond our means. Unbalanced budgets equal national debt, and national debt ultimately equals slavery! In the words of that Old Philosopher, "Debtors are slaves to the lenders" (Proverbs 22:7).

My hope and prayer is that this national crisis — fast turning into a world crisis — will turn each of us back to first principles, including the concept of truth itself. According to the Old Philosopher, "Truth stands the test of time" (Proverbs 12:19) — and that includes financial and economic truth.

Can we all now admit together that truth is not relative? That morals — doing what is right and avoiding what is wrong — really do matter? That living on our children's and grandchildren's wealth is sin (wrong/evil/criminal)? The Old Philosopher said that a good man "leaves an inheritance to his grandchildren" (Proverbs 13:22). Instead, we're leaving our grandchildren bad debt and bad money. We seem to have a gold standard for everything except our money!

The Old Philosopher knew that honesty and integrity matter. The present financial crisis cries out that honesty and integrity still matter. Cooking the books is wrong and morally evil. Dishonest politicians in bed with dishonest business practices (Freddie Mac and Fannie Mae) spell trouble. And we are in big trouble.

Some have rightly sought to warn us of our present financial meltdown (Martin Weiss, Richard Maybury, Don McAlvany, and others). However, I am reminded of Steven G. Austin's Life after Enron: Not Business as UsualRise of the New Ethics Class. Austin's concern in 2004 was with Enron, WorldCom, and HealthSouth, but his book also tells the truth about our present condition with Bear Stern, Washington Mutual, and Lehman Brothers, etc. What Austin and co-author Mary Steelman do is contrast the Book of Proverbs with the practices of the financial community, drawing the obvious conclusion that we as a nation are headed for destruction if we don't change our ways.

Austin proposes a game plan on how to emerge from this crisis although it includes some hard truth — honesty, integrity, Christian ethics, proper auditing procedures, etc. I never thought I'd be reading a book about the importance of "Generally Accepted Accounting Principles." But I did read it carefully and agree that such successful principles come straight from the Bible. (For an example of biblical accounting principles, see Exodus 38:21–23.)

But I want to address the largest financial crisis of all — our national debt. It is becoming more and more obvious that some of our present-day politicians are on the take (for example, look into who received Freddie Mac and Fannie Mae largess!). Those who are guilty must be convinced to do the right thing, or we will all go down into the dustbin of history together.

America, although a debtor nation today, has great resources and wealth to speak to our national debt. Here in a nutshell is a simple plan to address this problem.

Congress needs to swallow its pride and engage its enemy — ExxonMobil — to drill A.N.W.A.R. and split the profits 50/50 with the American people to be used only to drive down the national debt — not to be spent in any other areas.

This plan would also require Congress to balance its budgets each year and not add to the debt.

Instead of the taxpayer being burdened with another $850 billion of debt, this obligation needs to be carried by America's oil wealth. And drilling our own oil would save $700 billion a year that we presently pay to Middle East despots.

If ANWAR doesn't have enough oil to cover our national debt, then we should drill off the coast of Santa Barbara, CA, where the oil is literally oozing out of the ocean floor. (See Google's "Santa Barbara Natural Oil Seepage.")

If Alaska and California don't have enough oil and gas to pay off our national debt, we must develop nuclear energy and sell it to Canada, Mexico, and the rest of the world for a profit. Energy is obviously one of the major components that can provide answers to the questions of poverty, so this plan would help the poor as well. (See Proverbs 14:21.)

Let me remind readers that economicsthe so-called boring subject — is an important component in a biblical Christian worldview. It is a subject that warrants more attention in the classroom and from the pulpit in light of the importance of truth, morality, and concern for God's standards and ways as well as concern for our neighbors and their ways.

Economics, like music, can and must glorify God. Gold and silver are His monetary standard (see Haggai 2:8). Printing press paper money backed by the whims of politicians always loses its value and robs the common citizen. This is not God's will or way! Over the past 95 years, the American dollar has lost nearly 95 percent of its value. Yet, government's primary financial responsibility is to standardize and stabilize the value of the dollar and, according to the U.S. Constitution, that standard is gold and silver. (Article 1, Sec. 10: "[No state shall] make any thing but gold and silver coin a tender in payment of debts.")

Let us consider the real probability that three practices are responsible for our current economic meltdown: 1) going off the gold standard; 2) engaging in unacceptable accounting practices; and 3) acquiescing to moral laxity. Now let us consider how we can alter these practices in light of the solid wisdom of the ages!

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  • November 19, 2008 // 07:08 am //  # 
    Dennis Slone's avatar Dennis Slone

    Your assessment is right on. The truth is found in simple biblical principles that we have long ago abandoned. I think that it is a bit more though than moral laxity. Many politicians have bought into a Hamiltonian world view that basically supports deficit spending (see the book Hamilton’s Curse).  Also, there is little incentive for Congress to care about who pays – at least at the moment. Most only care about staying in power and reaping the personal benefits of their position.

    I believe the only thing that will work at this point is to institute a constitutional amendment that requires a balanced budget and forces us to repay our existing debt. The amendment would have to have a maximum tax limitation clause at all levels of government or we would quickly become a socialist state. What household can continue to spend beyond their means indefinitely? A Nation is no different. Someone has to pay for this mess going forward and I’m afraid it will be our children.

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