Facing economic crisis realistically

Facing economic crisis realistically

September 18th, 2011 in Opinion Free Press

The contrast between Tennessee's and Washington's handling of the economic crisis could not be any clearer.

Faced with high unemployment and a $14.7 trillion federal debt, the president and many in Congress think the solution is to borrow more money, raise taxes and try to spend and "stimulate" our way to job creation. The failure of the last stimulus to boost employment does not deter them in the least.

But in Tennessee, Gov. Bill Haslam is taking a different approach. He recognizes that Washington is not a limitless source of money, and he realizes that federal funds which are given can be taken away.

So he ordered state agencies to take a hard look at their budgets and prepare for the possibility that federal funds coming to Tennessee may be cut by as much as 30 percent in coming months and years.

Unlike the president and Democrats in Congress, Haslam is not looking to have state lawmakers impose huge tax increases. Also unlike the federal government, Tennessee is bound by its constitution to balance its budget. So our state will not be piling up deficits year after year the way Washington has.

Would big cuts in state agencies' budgets be easy? Could those cuts be accomplished without some real pain? Of course not. But responsible leaders understand that when you don't have the money to pay for some government service, you have to cut back.

Just imagine if Washington acted with the same discipline as Tennessee. Think of the benefit if we could just begin to reduce spending and debt -- and thus reduce the hundreds of billions of dollars we pay in interest on the debt every year. We could use those savings to pay down the debt even faster, and we could leave more money in the pockets of people who are likely to invest in new or existing companies that create jobs.

Tennessee is taking the economic crisis seriously. Sadly, there is no indication that Congress as a whole and the president are doing so.