Fiscal responsibility: Congress heal thyself

Oh, the irony.
While Congress calls for bankruptcy reform to make American debtors more responsible for their financial failings, the government’s own lack of fiscal responsibility is going largely unchecked – but not unnoticed.
The United States fell from third to sixth place among the world’s most creditworthy nations in Institutional Investor’s latest biannual survey of sovereign-risk analysts and economists.
As reported in the March issue of Institutional Investor, the United States had an average credit rating of 92.4 out of a possible 100, compared with 93.7 in the last survey, published in September 2004.
In the same six-month period, global average creditworthiness rose 0.2 points, to 42.9. While 50 countries gained at least a point, North America (the U.S. and Canada) was the only region to lose one point or more since September.
I would think that if individual Americans are expected to live up to their deficits, so should our government.

The real retirement crisis
While public attention, time and tax dollars are lavished on the Social Security crisis, the larger crisis – Medicare – is being ignored.
While politicians talk about Social Security paying out more than it takes in by 2018, Medicare’s Hospital Insurance Trust Fund already reached that point last year. So said David M. Walker, comptroller general of the United States, in his March 9 testimony before the House Ways and Means Committee.
Alan Greenspan, in his March 15 testimony before the U.S. Senate’s Special Committee on Aging, stated, “At present, the Social Security trustees estimate the unfunded liability over the indefinite future to be $10.4 trillion. The shortfall in Medicare is calculated at several multiples of the one in Social Security.”
Greenspan adds that because of shortfalls in both public programs, “either very large tax increases will be required to meet the shortfalls, or benefits will have to be pared back.”
There’s no quick fix here, and we all knew that. But it sure would be nice if the people in charge of fixing it would get started! I’d like to be able to retire in about 30 years.

A Blunt proposal
Enough of our nation’s woes! Thank God we’re living and doing business in Missouri.
Here in Missouri, there’s a new idea on the table that could be good news for workers. Gov. Matt Blunt has put forth a proposal, the Quality Jobs Act, that breaks new ground in terms of job creation in the state.
For employers to benefit under Blunt’s proposal, they must create new jobs that pay at least the county average wage, and employers must offer basic health insurance for the new employees and pay at least 50 percent of their health insurance premiums.
Participating employers would retain a portion of withholding taxes paid by employees in newly created positions, but the employees would receive full credit for all taxes withheld from their pay.
Is it workable? Will it do what it intends? Can we afford it? SBJ news staff will bring you the answers in our March 28 issue.

Words of wisdom
You cannot bring about prosperity by discouraging thrift.
You cannot keep out of trouble by spending more than your income.
You cannot establish security on borrowed money.
You cannot help small men by tearing down big men.
You cannot strengthen the weak by weakening the strong.
You cannot lift the wage earner by pulling down the wage payer.
You cannot help the poor man by destroying the rich.
You cannot further the brotherhood of man by inciting class hatred.
You cannot build character and courage by taking away man’s initiative and independence.
You cannot help men permanently by doing for them what they could and should do for themselves.
The preceding is commonly attributed to Abraham Lincoln but was actually written in 1916 by the Rev. William J. H. Boetcker. Regardless of authorship, it’s sage advice.

Clarissa French is editor of Springfield Business Journal.