Herman Cain's Commentary Archive 2009-2012

May 14, 2012

Will American voters follow Europe’s suicidal fiscal path?

By Herman Cain
May 14, 2012

I believe in democracy, and in the wisdom of ordinary people to make good decisions when they have all the information and understand the situation.

These are core principles for me, so I found them challenged this past week when voters in France and Greece acted in a way that seemed to clearly demonstrate otherwise. With much of Europe facing massive debt crises, and having agreed to abide by strict debt limits under terms of the European Union fiscal pact, French and Greek voters elected new governments that vowed to defy planned spending cuts and reject the debt limits.

This is especially egregious in Greece, which is supposed to be adhering to terms of an EU-sponsored bailout but cannot get its spending policies under control to save its life – and let there be no doubt, that’s what’s at stake here. Greece has built up so much debt bankrolling its welfare state, and has caused so much government dependence, it endured riots when it reached the inevitable point when the government had to admit it could no longer continue its reckless spending.

France is not in as much trouble, but in some ways the French election result is even more troubling because French President Nicolas Sarkozy was one of the authors of the EU pact imposing the strict debt limits. The election of socialist Francois Hollande represents a rejection of the very idea of fiscal responsibility, and leaves Germany in the precarious position of championing spending restraint and limits on debt while sentiment throughout the Eurozone seems to be moving entirely in the opposite direction.

What is going on here? Is my faith in people misplaced? And have I been wrong to express as much faith in the people of the United States – when we too face huge fiscal challenges and there seems to be little support for reform of the spending and entitlement programs that are driving the crisis?

I do not believe my faith in We the People is misplaced, but I do believe it’s important to remember the whole equation. The people will make good decisions when they have all the information and understand the situation. To the extent that people rely on politicians and the mainstream media to get their information – Houston, we have a problem.

Quite simply, it seems to be the modus operandi of the political class just about everywhere (and I include the mainstream media when I talk about the political class) to downplay the fiscal problems brought on by excessive government spending. To them, there is no problem that more government outlays cannot solve, and if there is not enough money on hand, it’s just because the people are too resistant to higher taxes.

As a case in point, the Associated Press reported on May 13 about the serious crisis facing the State of California, which finds itself $16 billion in debt. AP reporter Judy Lin offered a classic MSM take on the matter, saying the situation “will force severe cuts to schools and public safety if voters fail to approve tax increases in November, Gov. Jerry Brown said Saturday.” (Emphasis mine.)

According to the AP, voter refusal to accept even higher taxes will mean the public, not the free-spending politicians, has failed. The real failure, of course, rests in the hands of public officials who not only refuse to limit their own spending, but also refuse to be honest with the public about the situation.

Let me give you a perfect example that’s been in the news in recent weeks. You may have heard that interest rates on student loans are scheduled to double automatically unless Congress acts to rescind the increase. Democrats are screaming bloody murder and demanding that Republicans support a measure to keep the interest rates where they are. What they don’t tell you is that Democrats put the scheduled increase in place five years ago, and the reason they did so was so they could claim the original lowering of the rate would not explode the deficit over the long term. They do the same thing with physician reimbursements for Medicare. The long-term plan always calls for a huge cut in the reimbursements, and they use this to claim that deficits in the “out years” will go down. But when the time comes for the spending cuts to happen, or for the interest rates to double, they always stop it from occurring.

That’s how politicians put projections in front of the public that make the situation look less dire than it really is. The worst example comes from ObamaCare – big surprise, right? – in which Democrats counted $500 billion as a “spending cut,” then counted the same $500 billion as money to fund the program. The mainstream media were well aware of this deception, but did not call ObamaCare supporters out on it.

It’s hard to blame to voters for the decisions they make when politicians hide the truth from them, and the media – which are supposed to hold politicians accountable for what they say and what they do – instead act as their propaganda ministry, assisting in the deception by ignoring the worst of their dishonesty.

Having said that, voters have to look harder and more critically at the information they’re being given. It has to be the responsibility of the public to be better informed and less willing to accept the party line of the political class and its media enablers. I still believe that the people will make the right decisions if they have all the information and understand the situation. In France and Greece, that did not happen this week because the people obviously don’t understand the stakes.

The people of the United States can and will do better. I refuse to believe otherwise.