Comments on: Facing The Frustrating Realities With Which We Must Deal

By: LuxLivingFrugalis

LuxLivingFrugalis — Mon, 17 Mar 2008 20:29:15 +0000

Very well said NCN.

By: Debt Free Revolution

Debt Free Revolution — Sun, 02 Mar 2008 19:52:35 +0000

NCN, not sure how I missed this post, other than I’ve been working the weekend again LOL I too feel a growing unease about the economy. The Fed seems obsessed with cutting the interest rate in hopes of keeping the stock markets propped up, yet I am feeling the pinch of inflation here. People saving money and living within our means seems to be the best way out of this economic malaise, yet the government is actively promoting the exact opposite. We are told we are supposed to spend our way out of this downturn, when what people should really be doing i s save up money and pay down debt.

How many more credit “bombs” need to explode before the “conventional wisdom” finally changes?

By: NCN

NCN — Fri, 29 Feb 2008 18:32:53 +0000

Adfecto -
Thanks for the considered comment -
The debate about the role of government has been around since the (before) founding of our country, so, I’m pretty sure that my one post will not be able to ‘sum up’ all of the problems we face or the solutions we need. But, it seems obvious, that thet ‘safety net’ is unsustainable. At some point – when, I’m not sure – there will be more ‘users’ than there are ‘providers’. At that point, massive cuts will be need to be made – or, more than likely – massive tax hikes will be instituted. Those who save, live responsibly, and promote frugality will be ‘tapped’ to pay for the promises made by our government.
As for my aversion to credit – I have no doubt that there are institutions and individuals who borrow and invest with great success – BUT, if they borrow and FAIL then THEY should have to deal with the consequences of their behavior. But, what happens when the government borrows and FAILS? Guess who has to pay for their failures? Bingo – folks like me and you.
NCN

By: Bighonkin

Bighonkin — Fri, 29 Feb 2008 17:46:31 +0000

I know too well the frustrations of the people around me simply refusing to take financial responsibility. Trying to borrow their way out of debt, they have no idea that they’re nowhere near living the American Dream. In all honesty, it was NCN who prodded me to get to a place of financial responsibility and stability in my life, and I now try to do the same with those around me. We can take back this country. We can hold our politician’s responsible. If they refuse to be financially responsible, let’s fire them. Overall, though, this is going to be a grass roots movement and it starts in places like this.

By: Adfecto

Adfecto — Fri, 29 Feb 2008 17:35:31 +0000

You make some valid points. However, there are a few things I really disagree with you about.

You refer to all of the people today who are, “one misstep, one illness, one lost paycheck away from financial ruin,” as if this is a NEW thing. For the vast part of human history that precariousness of life and economic stability has been a part of the human condition. In fact, today a much smaller portion of the population lives this way than did those in all previous eras.

Today if you get very sick you still have places you can go for food, shelter, medical care, and a minimal disability check to get by and that is a GOOD THING. In the past these people would have been casualties of natural selection. They would have died young and completely impoverished.

You also rail against the, “handouts and bailouts,” but you must recognize that since the New Deal our country has experienced historical boom in standard of living, productivity, and economic might. By adding a system of safety nets our entrepreneurs are free to take the risks needed to build our society. If I thought that my family could go hungry if my business failed I would never invest.

If the system gets tipped too far toward the rich there is often revolt and sometimes war. By giving a helping hand to those at the bottom you also pacify them. The TV makes the balance seem pretty tipped these days so why are we surprised when people start looking for a hand out.

You are also binded by your bias against debt so you fail to recognize what an enabler it can be if used correctly. Our government can borrow at low rates from foreigners and use the money to fuel our very productive capitalistic society. Our economy churns out a much higher return on borrowed money than we pay in interest. The same is true for businesses and (some) individuals too.

Yes, we have a problem with people miss allocating their resources to flat screen TVs when the should be buying healthy food, durable clothing, and investing for growth. But these people would not succeed in business or investing either. If they miss allocate their money to a flat screen do you think they can figure out how to create jobs or help our economy in any way other than working and spending? We have a class of peasants in America that work to spend and they won’t ever get with the program you espouse.

I don’t blame you for being frustrated but I think we have reached a point in our society where the status quo seem more like an oligarchy. The masses want what everyone else has and it isn’t because of a lack of character, it is because of human nature. This same trend has played itself out dozens of times in history. Stop thinking of this as a weakness of those who are unsatisfied and instead start thinking about how to build them up.

This turned into a rather long and disjoint comment. I hope it makes enough sense and maybe makes some people think. Thanks for reading and to NCN for starting the discussion.