Resetting Our Lives,
Rebuilding Our Economy and a Walk in the Park

Few of us remember what blowing a fuse in our homes really meant. In most of today’s structures, a simple flick of a circuit breaker restores an outlets power, and if a true electrical fault exists, then subsequent resets and removal of suspect defective appliances usually clears the fault. In the older days (I am 56 years old) the replacement of an expensive fuse was always done after careful analysis of what could be causing the problem, with the hope of finding the problem and not having a repeat of blowing it again.

The economic meltdown we are now all experiencing has a strong analogy to a home that has increased its need for electricity, but has not increased the wire size or fusing of its circuits. The root cause of our present economic problems stems from the unsupported consumption our nation has taken on. Obviously the availability of money, whether by foreign debt or our own Federal Reserve, has made itself available to our nation and we have decided to use it as freely as it appeared. Increased credit availability and money supply allowed our nation to live “large.” So much of the news is dedicated to how it all happened, yet we are wasting time ignoring the obvious. You can’t live on credit and you can only fix the problem by changing the behaviors that brought it on.

We would love to blame a war, an administration or a foreign country, but let’s face a few facts. We are in debt because we lived beyond our means. Homes for people who could never afford them, new cars for people that could not afford them, vacation for people that could not afford them, a life of luxury and toys for those who cannot afford them. Nearly two generations of Americans have been brought up thinking that the American dream was a given, and that the size of that dream grew as if it was an interest bearing account. A myth developed that said one could always earn more, become more productive, and that there were no limits to what they could have. The simple law of economics tells us you cannot have more of anything unless you “earn” a surplus and build your own capital reserve, thus being able to service your loans. This holds true for individuals and our nation as a whole.

So now the focus must be on how to reset the circuit breaker. How we must cut spending, live simpler and take the type of actions that will restore our stability and worth. THE PAIN MUST BE ENDURED to get back on track. No amount of additional loans or stimulus will fix it, it will only prolong it. Yes we all want to see a couple of more trillion dollars injected to keep the inevitable from happening, but we can’t afford to do it anymore. Our children cannot inherit the devastation of unsupported spending. My thirteen year old niece Rachel even understood that the value of our money will become worthless soon enough, why can’t our nation get it? So if we are infected with a disease of living large, what would the doctor prescribe to make us well? What are the lifesavings actions we need to begin with today?

1) If you have no surplus capital and are living on debt STOP all spending now. Don’t go to Aruba, go to Jones Beach. Don’t buy a new car, fix your present one, and start to take care of it like it might be the only car you are ever going to own. Cut out all the extra stuff in your life and share what you have, that means everything. Spend much more time around the house and visit a neighbor. When you really run out of things to do and have an urge to visit the mall, instead take a walk in the park.

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