Comedy: Part 4. Debt, Deficits, and Self-Limiting Mistakes

I intended to give Katt a break for a while, but the government shutdown made this too relevant to pass up.

It’s not money won’t make your life better, cuz it will.  It’s just that money can’t solve what’s fucked up about you.  That’s the fucking difference.  Like if you’re an alcoholic, and you ain’t got but $20, you gonna get as fucked up at you can ’til you get to 20.  Soon as you get to 20, last call!  That’s it!  -Katt Williams [Money Makes it Better]

Yesterday I talked about how, as a result of constantly having to confront real, physical limitation and real, physical consequences, CrossFit communities tend to acquire a political culture that is very pragmatic and results-oriented.  Mistakes are self-identifying and unavoidable; you unrack a weight you can’t handle, you *will* end up dropping it.  Loudly.

I generally disapprove of deficit spending, and bailouts.  The reason behind this is that these tools often mask underlying problems.  Futhermore, these tools allow us to make these mistakes longer and lead to a much worse problem to deal with down the road.  Take a hypothetical situation:

Debt is separate from deficit spending, and a regular part of life.  The proper use of debt is to finance a purchase you are better off making today than tomorrow.  For instance, if my car breaks down and I need to buy a new one, I might not have the cash on hand to buy a new one outright.  But I can’t wait 5 years to save up that cash and buy the car then, so instead I take out a loan and buy the car now and pay it off over five years, plus a fee for the convenience of having that money up front, known as interest.  As I pay off that debt over time, my balance of savings vs debts moves in a positive direction; I am becoming better off.  In short, I have paid extra to make a future purchase in the present.

Contrast this with deficit spending.  This is where I am already in debt, having bought the car, and not adjusted my budget to account for that monthly payment.  Each month I continue to buy things I need less than I need the car, say $5 Starbucks coffee or $10 batches of cupcakes.  (Seriously, “upscale cupcakeries” are bizarre and will get their own Parable of the Cupcakery one day.)  Once my savings are depleted, credit extended in the form of credit cards allows me to go into debt to continue making this purchases I can’t afford.  These coffees and cupcakes weren’t future purchases that I needed to make now due to circumstance.  They weren’t things I was going to save up for.  They are part of a standard of living I now can’t afford, and each month I make these spending choices, I become worse off.

In this instance, the credit cards allowed me to avoid the consequence (going broke) of my actions, and furthermore allowed me to continue making my situation worse.

Unfortunately our situation as a nation is that of deficit spending while in debt.  We have financial obligations (debts) in the forms of bonds and entitlements, and we continue to spend more than we make (deficit).  The biggest problem is that we are so accustomed to $5 coffees and $10 cupcakes that we can’t fathom giving them up.  At this point, three entire generations have grown up in a national lifestyle financed by deficit spending.  We are like a person with three maxed-out credit cards who doesn’t understand why he can’t get a fourth and is about to turn to a loanshark to continue his downward spiral.  Although instead of having to drop $5 coffees, we are now looking at having to cut programs that entire populations, infrastructures, and communities have grown up around, and I don’t just mean favorite conservative targets like welfare-type programs.  Military base closures and cancelled defense acquisitions can decimate communities, corporations, and even smaller vendors all throughout the supply chain.  In short, it will be painful.  (More on this in the upcoming Parable of the Cupcakery.)

So, like Katt says, it’s not good to have too much money.  The alcoholic with $20 is going to sober up shortly after he spends $20.  But an average person can drink himself to death, and millionaires can hire personal doctors to drug them to death.  As a sovereign nation we have been able to dig an even larger hole, and soon we’re going to fall in it.

Don’t raise the debt ceiling.  It *will* lead to more debt.  Balance the budget.  Get accustomed to living in our means as a nation.  Don’t blame reality on the political party that makes the tough calls to balance the budget either.  Reality has been here all along, just waiting to jerk back on our necks once we ran out of rope.

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