Our Economic Illusion

How Borrowed Prosperity and Political Promises Are Eroding the American Dream

We Americans want it all… no taxes, no poverty, a strong middle class, and a government that won’t let anyone go hungry or be sick. Politicians promise us that if we vote for their political party, they will give it to us.

To any thinking person, the results are predictable. The rich get richer, the poor stay poor, and the middle class shrinks.

I understand why we want what we want. However, I also understand it takes discipline to get as close to what we want. I’d like the reader of this article to gain this understanding, too.

Whatever the Government Subsidizes Gets More Expensive

A subsidy is when the government offers tax credits or cash to help pay down the cost of something.

It doesn’t matter if it is healthcare or education. When the government helps the needy who cannot afford these services on their own, the price of those services will increase. If the government attempts to act and control the prices of these services, the availability of those services will decrease. This isn’t because of some nefarious, greedy company; it has been this way since the beginning of money.

Government Assistance Shrinks the Middle Class

When prices go up, the ever wealthier rich don’t particularly care. They pay the higher price and even up the ante by paying for better availability and quality of care than the masses getting the government program. It is the Middle Class who suffer the most.

The Middle Class does not qualify for the same benefits as the poor and must pay the market rate, which is much higher than it would be without government subsidies. They now have to reduce spending in other areas if they want these basic services. In some cases, these folks will drop healthcare coverage or not fund their kid’s college education because they can’t afford it. Ironic, isn’t it?

The Poor Stay Poor

The poverty rate has flatlined in the U.S. For all the programs we have, the poor are no better off.

Let me be very clear. People become poor for a large variety of reasons. I don’t care what those reasons are; I am not going to speak ill of those who are living in poverty.

That said, we have created a system that makes it easier for someone to remain poor than to join the working class. If I get free housing, free food, free healthcare, free cell phone, and free cable TV, if I live in a bad neighborhood, my kids don’t get much, and I at least survive, why should I get a job? It is hard to live in poverty. It is even harder working to get less than what you got when you were in poverty.

This is human nature. It is not some nefarious motive by lazy people to game the system. It is also human waste. Creating a system that incentivizes people to stay at home and not work harms a person’s self-worth.

The Evil Democrats

In a recent government shutdown, Democrats are arguing that Republicans are cutting healthcare benefits that will put many Americans in jeopardy. The truth is that these programs are government subsidies that grow annually. Their last ratchet up was during the COVID pandemic. Democrats want these subsidies to continue.

The sad fact is that healthcare prices are rising by 26% without subsidies. This is precisely the kind of dramatic price increase that the government subsidies are causing. They threaten the public, saying a 60-year-old couple in Kentucky will pay $25,000 per year if Republicans don’t relent.  As I write this article, the government has been shut down for 31 days because Congress can’t agree on this issue.

The truth is that Republicans are allowing the increased subsidies to lapse as Congress had agreed to. The subsequent increases are the result of a failed, unaffordable healthcare system. Democrats are evil because they are purposely attempting to deceive the public into believing they are somehow the gracious party who will ease the pain of unaffordable healthcare, which is not caused by government subsidies, but by greedy insurance companies. Please don’t fall for this lie.

The Evil Republicans

Republicans know what is happening with the economy of healthcare, immigration, and higher education. They smile as they put down the people who are relying on these services as if they are some kind of free-loaders. They are in power. Republicans control the House, the Senate, the Presidency, and have a majority of conservatives in the Supreme Court.

Yes, spending cuts are needed. However, increases in spending on low-priorities are just as harmful. The notion that we can cut spending in entitlements and still increase the national debt is evil. If you want to play the role of a fiscal conservative, you need to do it all the way. And while you control all of the government, it may be time to create the best legislation for immigration control, healthcare, and higher education. Take the time and educate instead of joining the barrage of insulting sound bites on Fox News.

The Solution

All of us Americans matter. We need to understand how the economy works and how to stop the runaway inflation that has diminished the quality of life for many Americans over the past 50 years. Stop asking for more government services and tax breaks, because they're only digging the hole deeper. Instead, ask for real change that respects the livelihood of future generations of Americans, even if that change may not feel like a personal benefit to you today.

We need to have compassion for the poor, not giving handouts but helping them find their way back to a place of self-sufficiency. We need to tax wealth in a way that is reasonable and doesn’t unduly harm our economic engine that has created the wealth of our nation. We need to close loopholes and backroom deals and pass legislation that works, not legislation that can be used as the next talking point of a combative politician.

What Can Congress Do?

Stop shutdowns and do your job! A representative's job is to represent your best interests. It is not to win the next election, or make their political party look good, or make the other political party look bad, or to pander to the uneducated in their respective political party.

The next piece of advice to you, representatives, is to stop the rhetoric. Each time my representative posts a meme claiming the other side is evil and they are good, I respond with what I hope is a truth bomb, not an insult. It contains my logical counterargument, not name-calling. Sadly, I doubt they read any of the thousands of responses they get.

All of us should have a say in our government. It is your job to educate yourself on these broader economic issues and advise your representatives on what you want. Stop blasting the other political party by repeating political rhetoric you heard on Fox News or MSNBC. If our voices get loud enough, we have a chance to stop our economic suicide. If not, we will be one more powerful nation that has historians scratching their heads about how we ended what could have been greatness.