The dominoes set in motion by the Greek debt crisis totter and topple. The credit ratings of other European states with debt problems similar to those of Greece get revised downward, and the costs of servicing their debt soar. Cracks in the facade of the European Union continue to appear, as the frugal states question bailing out the profligate borrower states — especially those with economies, and debt burdens, that are much larger in real terms than are found in Greece. The value of the Euro drops like an anvil directed at Wile E. Coyote’s noggin. Nervous creditors wonder if a wave of government bond defaults are in the future. And, across the globe, stock market indices drop with sickening speed as investors question whether the world could be plunged into an even more severe recession.
It is clear that unsustainable and unsupportable government borrowing is what led to the Greek crisis and the dire predicaments of other European countries. The choice for the United States is whether to chart a different course and start making serious spending cuts right now and or to continue our massive federal borrowing and potentially follow the Greeks and other European states into the debt abyss.
On this Mother’s Day, it seems appropriate to apply some of Mom’s wisdom to this issue.
We all remember the scenario. You were a kid who wanted to get your Mom’s permission to do something. She was not cooperating because she perceived, rightly, that it seemed like an ill-fated and stupidly risky venture. As she resisted all of your persuasive powers, you eventually said: “But Mom! Everyone else is doing it!” And her inevitable response was: “If everyone else jumped off a cliff, would you jump, too?” That ended the argument — and usually, either right away or after a while, you knew deep down that your Mom’s judgment was the right call.
In the United States, we can listen to Mom or we can join other countries in jumping off the cliff. I’m for listening to Mom.