What can you and I expect this morning? Will the carnage to our 401K continue? Will the market make another big drop, or will we get a positive bounce? Will interest rates go up? No economist has given us any assurances one way or the other. Most of them have said that if someone professes to know what is going to happen he is either misguided or lying.
China, our biggest creditor, has severely criticized our government for its handling of the economy. The G-7 nations are holding a telephone conference before the markets open Monday morning. Europe has its own problems, which are actually somewhat worse than ours.
Not to make light of our own problems. Our own problems are huge. The largest of which are the so called entitlements. When politicians speak of entitlements all they ever talk about are social security and Medicare. What they never talk about are welfare, food stamps, housing assistance, and the myriad other social programs.
Half the working age population is on the dole. They do not work, they pay no taxes, and they are supported by payments from the U.S. government. In addition to those programs we now have the increasing burden of the folks who have been laid off from their jobs, and are receiving unemployment insurance.
On the one hand you have social security, Medicare, and Unemployment Insurance, which have been and continue to be supported to some degree by tax payer payments, and on the other hand you have the other social programs supported entirely by the U.S. government, the recipients of these government programs having made no personal contribution.
These so called entitlement programs are the burden that is causing our government so much financial distress. All of these programs are still growing, adding to the financial burden the American tax payers must support. If the government taxed all of the wealth of the wealthy there would still not be enough money to continue to support these programs.
That is why the democrats are so insistent on taxing the rich. They think it will be easier to raise taxes than to make cuts to the entitlement programs. Taxing the rich is only the beginning; there are still those Bush tax cuts which have only been extended for a short time. When they expire everyone will get taxed more.
Obviously we should not cut any of these entitlement programs all at once. The social shock would be too great. Congress must discuss the options and try to arrive at solutions that will be the least disruptive to society .
At this point in time congress refuses to discuss cutting any of these programs. It would be far wiser to start serious discussions now than to wait until the burden of our debt crashes the economy, and we discover overnight that there is no money for any of these programs.
No matter what happens tomorrow morning there will be a huge job ahead for our congress and the administration, just to keep the ship of state afloat. Are they up to the challenge?