Austerity Measures

Am listening to On Point.  The discussion is about the austerity measures (rather dramatic) implemented in Britain.  Slashes in government agency jobs by 20% (except national health care) equate to about 500,000 jobs.  Those cuts apply to the military as well.  Can such measures be implemented here in the United States?

My answer – NO, NO, NO.

There are too many special interests, too many lobbyists to effectively implement such austerity measures here in the United States.  And there is  too much polarization politically to get anything done. 

Is it right to implement such austerity measures during a recession?  Let’s think about this one point:  unemployment is presently close to 10% in the United States.  If 20% of federal government jobs were slashed effective January 1, 21011, employment would increase to 20%, possibly (okay, I’m not a mathematician).  Those are depression era statistics.

So 20% of federal government jobs are slashed.  What are the ripple effects?  More home foreclosures [how many individuals have 6 months, 8 months or 1 year’s worth of living expenses?], reduced consumer spending, more individuals seeking assistance from government, churches and  non-profit groups, more individuals falling behind on debt such as credit cards, student loans and auto loans, more autos repossessed, and more crime.

But you may be thinking, we will have to either pay now or pay later.  That’s correct.   The United States must face the music sooner or later.

Just understand there will be ripple effects.

I’ve been personally living under such austerity measures since August of 2006.  That’s when I returned from my vacation in Northern California (haven’t taken a vacation since then).  I had an epiphany while sitting on the tarmac in Sacramento, waiting for the plane to depart.  That epiphany was I had allowed my personal finances to disintegrate since purchasing my home in January 2005.  I outlined what I had to do to return to financial sanity.

Four years later my financial portfolio has improved tremendously.  But I still have two other financial hurdles to overcome before I feel more secure.

Because of the polarization politically in this country, austerity measures should BEGIN with individual Americans.  In time our political leaders will see the light (hopefully)  🙂

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