America Is Facing a Cycle of Doom but Nobody Seems to Care

America Is Facing a Cycle of Doom but Nobody Seems to Care

By Dr. Thomas Patterson |

America’s political class can no longer put off the inevitable. They soon will have to pay for their insanely reckless fiscal practices.

It’s not going to be pretty. America’s debt has reached an appalling $31 trillion. Annual interest payments will exceed $1 trillion this year. Debt service is well on its way to crowding out other priorities, a trend which will only accelerate.

Unfortunately, a steep rise in interest rates occurred near the end of the biggest spending binge ever. Economists are warning we are nearing the dreaded “doom loop” in which interest costs can be covered only by more borrowing which further drives up interest expense, creating a vicious cycle.

There is a weird, almost preternatural calm about our dire fiscal future during this campaign season. We’ve seen much consternation about inflation, public safety, the border, and other critical issues. Yet politicians and the media hardly mentioned the debt crisis, so the public seems to assume everything is under control.

It isn’t, not by a long shot. Uncle Sam issued $7 trillion in new debt to finance the recovery from the COVID pandemic and our panicked overreaction to the disease. It’s too bad we can’t take back that $7 trillion.

Much of it was stolen by fraud and bureaucratic bumbling. Funds went to school districts, that haven’t spent them so far, to finance the indolence of those who preferred not to work and to Democrat pet projects like “climate change.” Millions of voters in no distress whatsoever got checks, as did some illegal immigrants.

Many economists predicted that injecting that much cash into the economy would cause inflation, especially since supply was limited by weakness in the labor market, fuel shortages, and supply chain problems. They were mostly ignored but turned out to be absolutely correct. After decades of relative price stability, we are now experiencing 8% inflation with no end in sight.

Millions of non-economists are experiencing what that does to your standard of living. Suddenly, food, fuel, and shelter have become existential concerns to millions of Americans, and the economic future looks dim.

Inflation also increases government spending. Social Security benefits are inflation-adjusted, resulting in an 8%, $100 billion increase. Total government healthcare costs will grow from $710 billion last year to $915 billion.

Financial markets cannot ignore the cloud of government debt hanging over our economy. A serious recession will almost certainly soon be upon us. Already, declining stock and bond values over the past nine months assure a steep decline in capital gains tax revenue, another contributing factor to the deficit.

The Federal Reserve board is doing the only thing it can to address inflation, which is to raise core interest rates. That also directly adds to the national deficit, increasing the interest cost and driving up the balance, since no other source of funds is available.

So, to summarize, unnecessary COVID-related spending of $7 trillion has combined with chronic overspending, which caused inflation, which increased borrowing costs, which drove up the deficit, thus precipitating a recession which will deprive the government of revenues to pay down the surging debt load. Way to go, guys.

The principle response of the Biden administration has been denial. Our president claims the economy is thriving. A monthly .1% drop in the inflation rate was the pretext for claiming inflation was in decline. The national debt is never mentioned, nor are the untold trillions in future promises we have made to senior citizens and others.

Instead, Biden issued a probably unconstitutional executive order “canceling” unpaid college loans – i.e., transferring the liability to taxpayers. It was terrible public policy, penalizing those who had behaved responsibly and incentivizing student indebtedness in the future. It spent yet more money in a desperate attempt to bribe some votes for the midterm elections.

Yet there seems to be little taxpayer resentment. Why should they care? Their taxes aren’t going to increase. The obligation will be added to the great river of debt passed on to future generations—you know, those little people who don’t vote yet.

They will inherit an America feeble and impoverished, that will have forfeited its greatness because of our greed and selfishness. STOP THE SPENDING!

Dr. Thomas Patterson, former Chairman of the Goldwater Institute, is a retired emergency physician. He served as an Arizona State senator for 10 years in the 1990s, and as Majority Leader from 93-96. He is the author of Arizona’s original charter schools bill.

The Urge to Spend Is Out of Control—And Time Is Running Out to Reverse Course

The Urge to Spend Is Out of Control—And Time Is Running Out to Reverse Course

By Dr. Thomas Patterson |

Loma Verde, California is building a $24 million recreation center with a pool. Forest Lakes, Minnesota is getting a $1.5 million golf clubhouse, while San Antonio is purchasing a $15 million theme park.

These may seem frivolous when rampant inflation is threatening, but never mind, they’re all “free,” a synonym for “paid for by the feds.”

America is awash in cash. Hundreds of other communities are enjoying similar goodies. States in no fiscal difficulty whatsoever have been given billions in budget boosts.

Checks for thousands of dollars have gone to citizens not even claiming to be in need. Millions of Americans receive enough government cash that they can now avoid the inconvenience and degradation of work.

These are the outcomes of President Biden’s $1.9 trillion-dollar American Rescue Plan, although the link to COVID may seem obscure to some. But the bigger point is that our governing culture today sees government spending as a positive good, which may be prompted by any excuse or none at all.

This is a continuation of the age-old argument over the role of government. For those who see government as a benign force that can efficiently, by use of its taxing power, address the common welfare and assure equitable outcomes, every dollar transferred from private to public hands is a positive.

Moreover, Big Government clearly increases the power and prestige of government officials. It creates beneficiaries highly likely to vote for those politicians who “cared” enough to send Other Peoples’ Money their way.

Vastly expanded government has also affected the attitudes of Americans toward the role of government in their lives. To an extent unthinkable to earlier generations, Americans now assume the federal government will take responsibility for such matters as healthcare, education, childcare, and aging parents.

The founders of our Constitution would not be pleased. Their original intent was to create a more just and independent society than the autocracies which had plagued mankind for millennia. Regrettably, Americans have blandly looked on while much of their birthright has been stolen.

Much of the recent confiscation of our nation‘s economic output has come under the pretext of COVID spending. But remember that the COVID financial crisis was a self-inflicted wound. The lockdowns were unprecedented and proved ineffective as a pandemic response strategy, but they precipitated a huge expansion of government power.

America has so far spent $6.4 trillion in COVID relief bills. The $1.9 trillion in the 2021 American Rescue Plan alone was enough to buy every COVID vaccine, ventilator, and hospital in existence. But much of the money went to beyond-obvious pork and to support Democratic political constituencies.

New York, among others, is reportedly sitting on $12.7 billion in unneeded COVID funds that they hope will revert to “unassigned” dollars. The money was pushed out so carelessly that the Labor Department IG estimates $163 billion of the $872 billion in COVID unemployment funds were dissipated in fraud.

The consequences of all this unnecessary spending are predictable and enormous. In 2009, then-President Obama warned against continuing deficits when the debt had doubled from $5 trillion to $10 trillion under his predecessor.

It was $20 trillion by the time he left office, stands at $30 trillion today, and will reach $45 trillion by 2032 according to Biden’s own budget projections.

But trifles like stifling debt and lack of need can’t suppress the political urge to spend. With COVID receding and no extraordinary expenses pending, Joe Biden’s new budget proposal rings in at $5.8 trillion, fully 31% higher than in 2019.

Federal revenues rose 18% in 2021, then 26% this year, but it’s not enough. Biden‘s $2 trillion projected deficit means the debt will have climbed $7 trillion in just the last three years. Multi-trillion-dollar deficits have effectively been normalized.

It could be worse. We narrowly escaped passage of the $3.5 trillion Build Back Better boondoggle. Yet now Biden has the gall to demand $30 billion more for COVID expenses when at least $500 billion from the last COVID relief bill is still unspent.

The mindless, immoral imperative to spend more knows no bounds. Time is running out to reverse course. When will we come to our senses?

The High Cost of Our Botched COVID Response

The High Cost of Our Botched COVID Response

By Dr. Thomas Patterson |

Let’s face it. America botched its response to the COVID pandemic.

Traditionally, as in the Spanish flu and polio pandemics, authorities have recommended common sense public health measures and protected the vulnerable. This time, they ordered sweeping lockdowns of the economy and closed schools, churches, and businesses.

The results were economic devastation, educational stagnation, greater income inequality, and loss of civic life.

Sweden, even though it has a reputation for a more collectivist mindset than our “land of the free” got it right. Their health officials adopted a live-and-let-live strategy, mostly rejecting lockdowns and letting normal life go on.

Initially, health outcomes suffered some, partly because Swedes neglected to adequately protect their nursing homes. But today, probably because of herd immunity, Sweden’s death rate is just over 1614 per million, compared to 2335 in Britain and 2836 in the US.

Even better, Sweden avoided the multiple consequences Americans now face. GDP growth is projected to be 5% larger than pre-pandemic, and they don’t face a mountain of future debt. Since schools stayed open without face masks, there were no lost years of education and test scores are up.

Unfortunately, America’s response to the self-inflicted wounds caused by our COVID panic caused yet more harm. When confronted with the results of their mismanagement, America’s governing leftists reverted to their universal solution for all ills: spend more money.

So last March, President Biden triumphantly announced “help is here” as he signed the $1.9 trillion American Rescue Plan. We were assured that the truly massive spending would help defeat the pandemic, reopen schools, and revitalize the economy, creating at least 4 million additional jobs.

We now know the bill was a colossal failure. We didn’t get more jobs, but we did get ominous inflation even though Biden had insisted that “no serious economist” predicted inflation as a result of the spending surge.

The inflation was totally predictable. At least 1.8 million people declined to reenter the workforce when the $300 per week unemployment benefit supplement was extended. That’s understandable since one study indicated that in 19 states, a family of four with two “unemployed” adults could receive $100,000 in total government benefits.

Meanwhile, trillions more were pumped into the economy. This excess demand, combined with fewer goods and services being produced, was the perfect recipe for inflation, which “serious economists” now acknowledge is probably here to stay.

Why did the plan have no effect on COVID? Answer: it didn’t really try. PolitiFact concluded only 10% of the bill addressed COVID health impacts and 1% went to advancing vaccines, the most effective way to impact serious disease.

Instead, the ever-vigilant spenders saw their chance to enact a wish list and took it. Their dreams that came true included $20 million for “preservation of Native American languages,” raising Obamacare subsidies, and a massive expansion of the child tax credit.

Since the feds are sitting on so much surplus funding (sarcasm alert), $350 billion went to state and local governments to help them weather the pandemic. But even when the bill was being considered, it was already clear that state-local tax revenues were growing, and their budget crisis never materialized. It was simply an excuse for feds to shovel out money, mostly to their friends in Democrat states.

Public schools were also showered with $120 billion to help them reopen safely. But the funds came with no requirements attached. By the end of FYI 2022, only $40 billion will have been spent, leaving education administrators with an $80 billion slush fund. Thanks, COVID.

So, another $1.9 trillion accumulates onto our debt load, and we have precious little to show for it. We have fewer jobs than were predicted in the “baseline” without the bill, and there was minimal or no effect on the course of the pandemic.

Lesson learned? Nah. Biden preposterously proposes spending yet more on Build Back Better, an even larger collection of handouts, as an inflation cure. Yet our debt is not only higher than ever ($30 trillion) but rising interest rates now will make our debt service more expensive and hasten the Day of Reckoning.

When will they ever learn?

Free Speech and the Great Barrington Declaration

Free Speech and the Great Barrington Declaration

By Dr. Thomas Patterson |

The controversy over COVID management is not a medical disagreement but a political fight. It’s also a free speech issue, the question of whether those who disagree with the political/medical status-quo should be silenced.

Although we have learned more over time about the origins and development of COVID, there is no question it is a contagious virus that spreads primarily through respiratory secretions.

Infections range from symptom-free to fatal, but serious disease and death occur almost exclusively in the infirm and the elderly. Like all viruses, the coronavirus mutates, apparently into variants that are more contagious but less deadly.

So far so good. The disagreement is over its containment. Americans have become a risk-averse people, where nonsensical catch phrases like “if it only saves one life” and “in an abundance of caution” have supplanted sober cost/benefit analysis.

So, our government’s go-to solution for the pandemic was lockdowns for everyone. Commercial, social, educational, and other personal interactions were halted to stop the spread of the disease.

The results of this massive experiment in public health were disappointing. 800,000 Americans have perished. There may have been some benefit to “flattening the curve”—spacing out illnesses to avoid overwhelming healthcare facilities—but the total number of fatalities was not much affected.

Meanwhile the cost of the lockdowns was enormous. The federal government spent $6 trillion in COVID relief, much of it wasted or misappropriated. Moreover, virtually all of the handouts were debt financed, pleasing current taxpayers/voters but assuring that Americans will be struggling financially far into the future.

The collateral damage included over 90,000 “excess deaths” due to forced shutdowns of routine preventive and diagnostic care. There were sharp spikes in levels of depression, substance abuse, and overdose deaths, especially among the young.

The Great Barrington Declaration (GBD) in October 2020 was based on addressing these “grave concerns about the damaging physical and mental health impacts of the prevailing COVID-19 policies.” It recommended an alternative approach called Focused Protection.

The authors were respected physicians from Harvard, Oxford, and Stanford with 91,000 additional professional endorsements, including from a Nobel prize winner. Their paper noted that vulnerability to death from COVID-19 was over 1,000 times higher in vulnerable populations than among young people. For children, COVID-19 is less dangerous than many other harms, including influenza.

Thus, it made sense to protect vulnerable populations if anything more vigorously, while reopening schools, businesses, and restaurants with reasonable precautions. Both overall mortality and social harm could be protected until we reached herd immunity.

In a society based on reason and open inquiry, this proposal would at least have received serious consideration. Instead, the Trump-hating media erupted in withering denunciations and cancellations.

Worse, recently obtained emails reveal that our “follow the science” authorities intentionally thwarted the dissenting viewpoint. Then-director of the NIH Francis Collins wrote Anthony (“I am the Science”) Fauci that GBD seemed to be getting some attention. “There needs to be a quick and devastating takedown of its premises. Is it underway?”

Fauci answered in the affirmative. Soon after, he informed The Washington Post that GBD was a fringe operation. “This is not mainstream science. It’s dangerous.”

Several media outlets ran with criticisms by Fauci, who completed the cycle by citing their articles in his talking points. Facebook pitched in by censoring any references to GBD. It was the dreaded “misinformation.”

Focused Protection never got traction. But shutting down open dissent in favor of political agendas has produced tragic consequences. In spite of Fauci’s claim in October 2020 that the draconian remedies were temporary, when caseloads rose the next month, shutdowns were resumed.

Hard data is never available on the path not taken, but it’s undeniable that the costs of following the Fauci/Collins strategy were staggering: unbelievably enormous federal outlays, shattered businesses, untreated illnesses, suicides, and devastating educational achievement losses.

Let’s be smarter with omicron. Let’s vaccinate and medicate, protect the vulnerable but avoid panic and unnecessary disruptions in our lives.

The Great Barrington Declaration, the responses, and consequences are a reminder of the practical importance of free speech rights. Better decisions are made when all sides are heard out.