Go Ahead and Spend and Maybe Someone Will Bail You Out. Or Maybe Not.
Organizations and individuals who act responsibly realize that you have to earn more money than you spend. That’s the secret to prosperity. And the key to that is to continue to improve your income, not to continue to reduce expenses. You can’t cut your way to growth.
If the government were to simply eliminate all college loan indebtedness, and force taxpayers who did not incur it to pay for it, we are merely rewarding a lack of accountability and sloth. And what about past college debt successfully paid off by most people who have incurred it? Do we go back and reimburse them? Why is the current group of debtors absolved at everyone else’s expense?
The Great Recession of a decade ago was partially caused by poor institutional lending and poor (or no) government oversight. But it was also caused by individuals who decided to use the equity in their homes as a piggy bank to simply spend more and more using debt instead of trying to earn more and more to pay for vacations, multiple cars, private schools, and large-screen TVs. Most people in this country think they’re solidly middle class, and most people think they’re above average in intelligence. I’m no mathematician, but how can that be?
When you arrive at a point where personal accountability is no longer required or admired, and the government is expected to bail people (and companies) out of disastrous debt caused by their own poor decisions, we’ve arrived at the edge of the cliff. The Road Runner is gone, and the Acme Company cannot bail us out of this one.