John Whitehead's Commentary

"The Titanic sails at dawn."
--Bob Dylan, "Desolation Row," 1965

The Titanic, the largest and most luxurious boat afloat, was the marvel of its day. With a double-bottomed hull that was divided into 16 presumably water-tight compartments, four of which could be flooded without endangering the liner's buoyancy, it was considered unsinkable. However, shortly before midnight on April 14, 1912, the Titanic collided with an iceberg. Two and a half hours later, it was at the bottom of the Atlantic Ocean.

With the release of President Bush's fourth budget to Congress requesting $2.34 trillion in spending money for the fiscal year 2005, our country--at present the marvel of the world--is beginning to look like the Titanic. Already, our national debt is $7 trillion (one trillion dollars translates to a million million dollars) and growing, much of it owed to foreign banks. It seems that our politicians, both in the White House and in Congress, have lost their fiscal sense. Consider that the President wants to spend $12 billion to fly to the moon!

Incredibly, most of our politicians do not seem concerned that we are spiraling out of control. Indeed, our country's leaders have succumbed to an almost total economic irresponsibility that has been going on for a long time. Each year since 1969, Congress has spent more than its income and the Treasury Department has had to borrow money to meet Congress' appropriations. Even when government officials claim to have a surplus, they still spend more than they receive. As a result, we, the American taxpayers, pay the interest on that huge debt. In fact, the interest expense on the national debt is the third-largest expense in the federal budget. Moreover, although we are now only a few months into fiscal year 2004, the national debt has already cost us $115 billion. The bottom line is that there is no such thing as government money anymore. There is only taxpayer money, which our government takes from us and spends on government programs that taxpayers have virtually no say-so about funding.

Believe it or not, with all the talk about national defense and even with the increase in the military budget in the age of terrorism, a smaller share of federal funding is now devoted to our national defense. Traditionally, about one-third to one-half of all federal expenditures were for national security. That percentage is now down to less than one-fifth. So what are our politicians funding with taxpayer money? Big government and social programs. In fact, almost all the government growth in the past 50 years has been a result of increased civilian social-program spending.

In 1940, there were 4 million Americans working for the government and 11 million working in manufacturing. Today, there are 7 million more Americans working for the government (21.5 million) than in all manufacturing industries (14.5 million). "We have shifted from an economy of people who make things," writes Stephen Moore of the National Review (Feb. 2, 2004; www.nationalreview.com), "to an economy of people who tax, regulate, subsidize, and outlaw things. We certainly have more rule-makers and red-tape dispensers than ever before."

And our current president is not about to offer us a smaller government or a manageable budget. In fact, President Bush has allowed the budget to grow by 8% per year after inflation in his first three budgets. Now, in his bloated budget for 2005, the president seeks funds to keep marriages intact, prevent over-eating, encourage teenagers not to have sex and help give Americans the willpower to stop smoking. His proposed Medicare drug bill is already up to $100 billion. "Should it bother us that both parties have bought into the belief that government now needs a federal program, bureau, agency, or grant contract to deal with every conceivable human need?" asks Moore.

As any good political theorist will tell you, economics and political freedom go hand in hand. Several months ago, the Heritage Foundation and the Wall Street Journal issued an economic-freedom index in which the U.S. ranked only number ten worldwide. What the study discovered was a strong statistical relationship between economic freedom, limited government and economic growth and prosperity. As our socialist state continues to extend its tentacles into every area of our lives, freedom itself seems to be doomed to the scrapheap of history.

For too long, politicians have drained the coffers of our government completely dry, while overtaxing the American public at an astonishing rate. This cannot go on forever. Some economists are now predicting that if the deficit train is not slowed, the country will be bankrupt within 30 years, but it could happen sooner than that. "Our country is insolvent and bankruptcy will come. And there will be liquidation of debt," remarked Congressman Ron Paul (R-Tex.) in a recent interview with Oldspeak magazine. When asked if this meant a depression, Paul responded, "I think it is going to be very, very bad. We are much poorer than we think we are. The debt, however, will not be paid. Some actually believe the $7 trillion can be paid off. But the debt will be liquidated."

The danger is that if a depression occurs, there will be upheaval and turmoil. This, of course, raises the fear that in an effort to maintain order, many Americans will call for stronger and stronger government. Yet as history teaches us, that is how the worst tyrants come to power.

America the Titanic? What do you think?

ABOUT JOHN W. WHITEHEAD

Constitutional attorney and author John W. Whitehead is founder and president of The Rutherford Institute. His most recent books are the best-selling Battlefield America: The War on the American People, the award-winning A Government of Wolves: The Emerging American Police State, and a debut dystopian fiction novel, The Erik Blair Diaries. Whitehead can be contacted at staff@rutherford.org. Nisha Whitehead is the Executive Director of The Rutherford Institute. Information about The Rutherford Institute is available at www.rutherford.org.

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