Contingency plan

Good business plans often have a category for contingencies.

Due to our debt crisis, the U.S. has precious little in the way of resources for a contingency.  While we are clearly aware that having a $15 trillion deficit is a big problem, we are being directed away from the urgency of our situation and the need to identify how to address it.

The Congressional Budget Office – which is being revered as our savior, since the Congress’s Joint Select Committee on Deficit Reduction (remember them? last summer’s “Super Committee”?) has failed – may be being given inadequate data and the administration is using their incomplete projections to inspire confidence in its leadership.  It would be criminal if our leaders were doing this intentionally: going forward as if a reasonable solution is at hand, when they know their programs are going to breakdown as soon as they roll out the door.  What would we say about a company that did that?  How long would they be in business?

Even for those who don’t think America necessarily needs to be run as a business, any responsible citizen understands that if an individual incurs debts, they have to pay them off – both in order to maintain a decent credit rating and also to honor one’s obligations.  And most of us who have been around the block know that things happen: emergencies and natural disasters, the furnace fails in the middle of a cold winter, unexpected doctor’s bills or a family member who needs help.  That is when a contingency plan – and the savings to execute it – helps keep things running smoothly.

Due to our debt crisis, the U.S. has almost no buffer left and limited resources for a contingency.  We don’t like to think of our country as being like families who are only one emergency away from losing everything, but we are closer than the media and the administration are willing to tell us.  We would do well to take a serious look at Greece and ask ourselves if we are walking on the same path.  Two years ago, in 2010, Greece’s interest rate on their bonds was roughly 10%.  Last year, their “emergency” resulted in their not having the funds to keep their social programs going, and the country’s interest payments on their bonds had to be bailed out to prevent their losing everything.  The World Bank is still trying to find a feasible method for Greece to work its way back to self-sufficiency, and it will be a long time before they’ll be able to stand on their feet again.

Here in the U.S. – now – we are facing rapid increases in the cost of fuel and other factors outside our control – or so we are told.  We have little buffer left and our country has lost its AAA credit rating.  When we come to the consensus that we must honor our obligations – not only to today’s world but to our grandchildren’s opportunities – and cannot raise the debt ceiling any further, could the U.S. be facing a downward spiral like Greece’s?

We can expect a breakdown here when the government checks stop being issued – and one day, soon, they will stop.  There may be civil unrest in our streets – and if so, will the federal government use the same approach as they did for the “Occupy” movements: that the problem can be dealt with it at local level, because the President supports their right to protest, and the local governments just need to pay the police overtime?

Local emergency preparedness only goes so far.  This is not doomsday, it’s very recoverable – but we may be faced with outages.  During the depth of its energy crisis ten years ago, California had rolling power black-outs.  Will we be seeing welfare outages, unemployment outages, and police and fire protection outages?

What we truly need NOW is leadership. The Community Organizer in Chief who is in the spotlight for personally calling to console the individuals impacted by local crises seems to prefer to redirect the U.S. citizens away from these national matters. Based on our past experience, one would expect the current administration to throw up their hands and exclaim “It’s out of our control,” that the CBO’s projections didn’t show this.  In an emergency, people are looking for a reasonable leader, not emotional reassurance.  We need to know that our leaders are working on a solution, not falling back on excuses and fear. We need reasonable leadership that provides a sound basis and a plan for dealing with the emergency, and identifying the contingencies.

Is our current leadership too busy defending the problem to understand and correct this dire situation – because the corrections would go against the policies it has put in place?  We need a leader who has the energy to produce results outside of these downward-focused policies, who has a good business plan and can prepare for contingencies that keep us from losing everything.  Most community organizers work off government grants and contributed funds, but as a country, the U.S. does not work that way.  Regardless of how much money is printed, the current policies have not worked and will not work to get us past this emergency.  As with individuals in a debt emergency, we need to take away the government’s proverbial plastic and tell it to stop spending money it doesn’t have.

Benjamin Franklin said: Make poverty easy, you will make more it.  But that is not a contingency that America wants to look forward to.

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