Just a short time ago, we as a nation were having a discussion on raising the debt ceiling. It was roughly a year and a half ago that we went through this painful exercise. The U.S. had reached the limit on our national credit card, and instead of cutting back our spending we borrowed more money to pay off money we have already borrowed. If this seems ludicrous, it is.
It would be hard, if not impossible, to find a single person who would address our debt problem with the same solution the president presented. What is more ridiculous, approximately six years ago, Sen. Obama voted against raising our debt ceiling.
In March 2006, Sen. Obama stated: “The fact that we are here today to debate raising America’s debt limit is a sign of leadership failure. It is a sign that the U.S. government cannot pay its own bills. It is a sign that we now depend on ongoing financial assistance from foreign countries to finance our government’s reckless fiscal policies. … Increasing America’s debt weakens us domestically and internationally. Leadership means that ‘the buck stops here.’ Instead, Washington is shifting the burden of bad choices today onto the backs of our children and grandchildren. America has a debt problem and a failure of leadership. Americans deserve better.”
When President Obama talked about the debt six years ago, our debt was roughly eight trillion dollars. Under President Obama’s leadership, we are roughly double that amount today. However, President Obama in his last press conference attempted to justify his administration’s debt increase.
What has changed in Mr. Obama’s mind since he made those comments? We will never know. Nonetheless, his 2006 comments were dead-on and he should have executed on his own criticism instead of political grandstanding to win an election.
His 2008 campaign echoed the same sentiment. A quote from his first campaign is: “The problem is that the way Bush has done it over the last eight years is to take out a credit card from the Bank of China in the name of our children, driving up our national debt from $5 trillion for the first 42 presidents, and #43 added $4 trillion by his lonesome, so that we now have over $9 trillion of debt that we are going to have to pay back — $30,000 for every man, woman and child. That’s irresponsible. It’s unpatriotic.”
It is clear we need to cut spending, everyone knows it and it is time for the Obama pandering to stop. This may be painful for the U.S. economy in the short term. It might temporarily slow our economy, but it is time for the president to act on his own words. As Ben Bernanke said at the Economic Club last November, “We are on life support.”
It is time to start breathing again, slowly building our strength by cutting off spending we cannot afford. Many people who voted for the president may get their feathers ruffled, but it is time to act. When you take a hungry toddler to the grocery store, do you allow them to fill the cart with their every desire? The answer is clear. President Obama has made a bad situation worse. He said at his most recent press conference that his “point of view is reasonable.” It is not, as the U.S. debt continues to increase.
Richard Zipkis is chief investment officer of Granite Group Advisors on 187 Danbury Road, granitegroupadvisors.com. Contact him at [email protected]