How Our Political Leaders Have Failed Us

What is the role of government? This is a hot button topic these days, but if we hearken back to the Founding Fathers of the United States, the basic role of government is to provide for the infrastructure (roads, emergency services, etc.), national defense, and protecting the rights of its citizens.

Today, though, many people assume that the role of government is to provide many other services, too. Perhaps that should be some of its responsibility, but as the government has grown, our political leaders have become elevated to such a level of power that there is rarely a genuine checks and balance system in place to hold them accountable.

Which is why America is currently $23 trillion in debt, and counting (US Debt Clock). In fact, in my last blog I recently wrote, “A Nation in Debt: Why You’re Stuck in Credit Card Debt and Can’t Get Out, I stated that we are at $22 trillion in debt. As of this writing we just hit $23 trillion!  The numbers are simply staggering.

By the numbers.

Let’s take a closer look at the sheer numbers this $23 trillion in debt encapsulates. For United States citizens, everyone essentially owes $70,213 toward that debt. That’s for everyone, including the newborn infant that is, right now, just crying her first cry of life. The debt per taxpayer is $187,391.

Another interesting figure to keep in mind is that there’s a difference between “official” spending numbers and actual numbers. For example, as of the time of writing this blog, the ‘official’ US federal spending rate annually is: $4,560,649,197,000. The actual US federal spending is: $4,812,765,095,000.

Yes, there is a discrepancy in the numbers. Is it a ‘little’ issue? That depends on your perspective. Is nearly $300 billion a ‘little’ issue?

Not to me. Not a single person alive today will ever actually earn $300 billion in their entire life. Bill Gates won’t. Mark Zuckerberg won’t. Warren Buffet won’t.

Now, let’s look at some other numbers. Total US consumer unfunded debt currently stands at $75,473,000,000,000! The average debt per citizen is $228,465. The total debt per family is $889,374. Keep in mind, though, this is total debt (including business). Personal debt stands at $20,284,575,565,000. The average personal debt per citizen is $61,386. Again, keep in mind that ‘per citizen’ represents everyone, including that newborn baby (poor girl).

The debt to income ratio is 1.845 … and climbing. Essentially, we are not earning enough to pay all the debt we’ve accrued. Not even close!

So, what does this have to do with our leadership in government?

Answer: a lot. 

Consider family dynamics.

I want to create a little story for you. Tom and Tina were successful business professionals. They married in their mid-20s, college sweethearts who honestly believed they were perfect together. Soulmates, as it were.

They decided to wait on starting a family so they could build their careers first. It was a fiscally responsible decision for them that helped them become fairly well-off.

They weren’t “rich” by most standards, but by the time they welcomed their first child into the family, they had a house, two nice cars, decent furniture, and several thousand dollars in savings.

They had two other children along the way and continued to advance in their respective careers. As Tom and Tina both became more successful, they spent more money. They decided to move to a bigger house, enjoy ‘nicer’ vacations, and begin spending increasing amounts of time with wealthier friends and individuals.

This kind of fueled their passion for spending even more. The Honda was no longer good enough for Tom so he traded up for a Mercedes-Benz. Tina opted for a Porsche SUV.

As their children moved into their teenage years, they got the nice clothes, the latest iPhones, and all the things they wanted. There were no limits to spending in this family.

Tom and Tina assumed they were fine because, collectively, they were earning approximately $150,000 per year. But, they were mortgaged to the max, carried over $50,000 in credit card debt, and had essentially depleted their savings. Between all their debt, they owed over $875,000.

Everything they bought moving forward had to be covered by more debt.

They managed to carry this lifestyle on for a long time, but as their children graduated high school and then college and headed into their adult lives, each one of them got into serious financial trouble.

Tom and Tina did their best to bail them out, but they were limited. They couldn’t understand how all three of their children got into a major financial mess so early in life when they had done “so well” for themselves.

Tom and Tina taught their children poor financial lessons through their actions. Their children viewed desires and wants as necessities. They believed since their parents could purchase anything they wanted on credit cards all this time, then it couldn’t be a bad thing.

Welcome to America.

Is this story of Tom and Tina all that different from what we’re experiencing as a nation? Tom and Tina represent our political leaders at every level: local, state, and federal.

For generations the United States has been the wealthiest nation in the world. In fact, the US is the wealthiest nation in the history of the world (Alternet).

With all of that wealth, monumentally strong GDP (Gross Domestic Product, or the sum of all manufactured goods in this country), the global economy shifted from gold-based to US dollar based, which provided an incredible boost in borrowing power for this country.

Just like with Tom and Tina who began earning more, they started getting more credit card and loan options. They took advantage of them and began spending, spending, spending.

Our political leaders have done the very same thing, promising services along the campaign trail, authorizing spending hand over fist, and just tacking it on as more debt.

So what has happened? While there are organizations out there seeking to hold political leaders accountable and trim spending, they have little power. Why?

Because when the United States finally cuts back on its spending, people lose services they have grown accustomed to and now believe to be ‘rights’ rather than the privileges of living in a wealthy nation.

And, like Tom and Tina, the children in this story, the US citizens, have learned that since it’s okay for the government to continue piling on the debt, it must be okay for us as well.

Let’s talk about promises.

Political leaders make promises all the time, especially during election years. It seems right now, though, a few Americans are finally waking up and realizing those are either empty promises the candidates have no intention of keeping or will cost the nation more than it can afford.

This isn’t about getting caught up in political debate, but rather talking about the financial issues we, as a nation and individually face. Both sides are guilty of this malfeasance. 

When our political leaders make promises that they will increase spending for certain services, raise or lower taxes, cut services to other organizations to save money, and so forth, and rarely ever follow through, how is that reflected in us?

It becomes easier for an individual to make a promise to repay a debt or a loan and not really follow through. Promises become worthless. Suddenly, when the collection agencies come calling and knocking and repossessing, what you do?

Many people turn to blaming others for their failures or shortcomings. It’s easy to do.

It’s what we see every day from our political leaders. One party blames the other and the other party blames back. The pointing of fingers is constantly directing people away from the biggest issue at hand: the mounting debt that is simply unsustainable.

Sometimes, the right course of action is to trim spending and start paying down debt. But our leaders don’t do it. They don’t lead by example.

As noted in Psychology Today, “A good example occurs often in politics. An elected leader knows what is the right thing to do, but wavers from that path because taking the right course may alienate some voters and hurt the politician’s chances for reelection. You can’t lead effectively if your actions are motivated by staying in power, rather than taking the right actions.”

Too many of our political leaders are more focused on staying in power than doing the right thing. And what do we citizens learn from that?

Getting what you want now is more important than doing the right thing. And so, we are a nation speeding faster and faster toward a cliff. The warning signs are all around but we hold on to that youthful, teenage mentality of “Bad things won’t happen to me” while we stomp our foot harder on the accelerator.

Causing financial crises.

According to the US News article, Failed Leadership Caused the Financial Crisis, written by Bill George and published November 19, 2008, “These failures were not caused by complex financial instruments. They result from failures in leadership. Heads of the failed firms forgot two basic principles of business: To sustain success, firms must serve their customers well for the long term and contribute to ensuring healthy markets.”

While this article was written in the wake of the Great Recession and its focus was on business leaders, the same holds true of our political leaders.

As they have failed to consider the welfare of the nation long term and only seek immediate gratification (reelection), they have become the worst example for fiscal responsibility our nation’s citizens have ever witnessed.

The belief as a nation regarding our total debt continues to be “it won’t happen to me.” Meaning, it’s not going to affect me directly, so it’s not a big deal.

That’s not true. It’s the same with accruing higher and higher debt on a personal level. We may assume everything’s fine since we still have a roof over our head, a car to drive, a job, etc., but eventually the debt will become too big and crush us.

That’s when people lose everything, often at once.

Sadly, I’ve witnessed this firsthand at the ground level with many of my clients who simply would not change their spending behaviors.  As I’ve written extensively in the past, for many it’s an insidious spiral downward that has a catastrophic ripple effect throughout their entire lives including their health, relationships, work productivity, and general well-being. Like an addiction, these spending behaviors have literally destroyed people’s lives. 

That’s why we sincerely need to address the broken belief system we have as individuals and a nation involving money and finances before it’s too late.