The US economy is driven, ultimately, by consumer spending. And more importantly, by middle class spending. When middle class incomes have remained stagnant over the past generation, consumers were faced with the choice of going without or purchasing on credit. But credit purchasing cannot continue permanently. Eventually, the bills must be paid. And when the bill collector comes calling at the same time that housing prices tank, spending on consumer goods grinds to a near halt. It’s not surprising that when credit tightened in the fall of 2008, consumer spending ran off a cliff. And when consumers quit spending, employment fell precipitously as the entire economy contracted.

Businesses won’t resume hiring until they have a market for the goods and services they produce. And consumers can’t resume purchasing until they have money to spend. So, if we truly want to help create jobs, the best and the only solution is to get more money into the pockets of the middle class. We cannot expect the 1% to carry the economy. Sure, they have a lot of money to spend. In fact, they have more money than they can possibly spend. Putting even more money into their pockets won’t have the needed stimulative effect on the economy. Putting more money I to middle class pockets, on the other hand, will create demand for consumer goods. And increased demand will mean more hiring. So, in reality, it’s the middle class who are the real job creators. It’s time that Congress got the message.

You can spin history all you want, but you can’t change the facts.  Epic FAIL!

My first computer, some 30 years ago, was an Apple IIe.  By today’s standards it was incredibly kludgy.  A black & white monitor, a single drive for those 5 1/4″ floppy disks, no hard disc, no mouse, and less RAM than in the simplest of today’s calculators. And operating it meant that the user had to type in precise commands to accomplish anything. No GUI interface in those days, and only one way to do any given operation. But it was cutting edge at the time. My kids got their first taste of programming with Logo, sort of an electronic version of an Etch-a-Sketch, where the user commanded a cursor shaped like a turtle using simple typed commands to create pictures.

I’ve been largely a PC user since then, price-driven, and also because of the greater availability of programs for the casual user.  But once the iPad hit the market, I began to lust after my dream computer — one as fully functional as my PC but more intuitive and not dependent upon a mouse, track ball or touch pad.  Apple is nearly there, what with the latest version of their touch pad.  I’ve been saying that when it’s released, I’ll be standing outside the Apple store along with the twenty-somethings.

PCs have made computers financially accessible to a wide range of people.  But the features, the sheer elegance of Apple’s designs, are drawing me ever closer.  I gave up the desktop model with my current PC, and now that we have an Apple store closer than an hour and a half away, well, the siren is singing her song.  I’m only wondering how long I’ll have to wait…and how soon iPads will incorporate flash.

It reminds me of a friend’s young son, about age 4, immediately after the major earthquake that hit Southern California in February 1971. His mother went to check on him and his 6 year old brother, who shared a bedroom. The younger boy was sitting upright in bed, eyes as big as saucers. Pointing to his still-sleeping brother, he announced, “Guy did it!”

A Constitutional amendment to balance the budget means that the Federal Government could NEVER, ever have expenditures that outpace income.  Not in time of war, or natural disaster, not ever.  A balanced budget amendment might help keep us out of unnecessary wars, like, say, Iraq.  No more butting into other countries’ business.   But how would we pay for any war?  Selling war bonds like during World War II?  Those war bonds went to building bombers and tanks and making bullets — bonds along with rationing any raw materials that went toward manufacturing war materiel.  Under the GOP’s anti-tax mantra, raising taxes to fund a war would be off the table.  Or would it…?

Since the GOP is so fond of using household budgets as the analog for the federal budget, let’s look at how a balanced budget amendment compares to a household budget.

Do you have a mortgage on your home?  Do  you have a car loan?  Do you use credit cards?  Do you or your kids take out loans to help finance college expenses?  Do you refinance your home or take out a second mortgage to pay for remodeling or renovating it?  All those borrowing options would be off the table if you used the rubric of a balanced budget amendment.

Raising the debt ceiling doesn’t represent new spending.  Rather, it is borrowing to cover past spending — like the Bush tax cuts, Medicare Part D, and the wars in Iraq and Afghanistan.  To default would be like deciding to default on your mortgage or to refuse to pay on your credit cards.  So, your house would be foreclosed and auctioned off on the courthouse steps.  Your car would be repossessed.  Your credit cards would be canceled — but you’d still owe the remaining balance.  And your credit rating would drop like a rock.  And when you finally paid them off, you’d find that your interest rate would be sky high should you apply for a new loan or new cards.  And if those consequences weren’t challenging enough, the black marks on your credit rating would remain for years after you paid your bills and paid any future bills, such as rent on a place to live, on time.  To make matters worse, the rent you’d have to pay would likely be higher than if you had an excellent credit rating.  If those acts kill your personal credit rating, just imagine what it would do to a country’s credit rating!

Some members of the GOP don’t think that default would be so bad.  They don’t believe what the economists and the Treasury Secretary and the Chamber of Commerce or the bankers are telling them.  They only pay attention to the voices in their heads or on Fox News.  They don’t look into the ideology of the Koch Brothers or of the supposedly non-partisan think tanks that spout Milton Friedman’s version of economics.  One GOP legislator allowed as how stiffing China and Saudi Arabia might be a pretty good idea.  What he fails to realize (or perhaps he just doesn’t care) is that American pension funds are a very significant holder of treasury notes.  So, along with stiffing the Chinese and the Saudis, a lot of Americans would also get stiffed — and not all of them would be those hated public employees.  They might even include Congress… along with aerospace retirees among others.

Spouse is currently enjoying his afternoon snooze, but we’ll soon be enjoying a glass of celebratory wine on our new patio. The table and chairs set is waiting for us to pick it up at Sears. An arbor with attached bench is on order from Amazon, and tomorrow will bring a trip to our locally-owned garden center to begin picking out plants for the beds and perhaps some new containers. And an awning is on order from Costco.

Needless to say, we are kicking ourselves that we waited so long. But a layoff notice four weeks after we moved in put a serious crimp in our original ideas, and over time, we just got used to it. Ran into a friend this morning as we picked up our weekly produce box from a CSA, and she asked how soon we were going to inaugurate the new space…just as soon as we get the awning in and up and some of the plants in. Some will need to wait for cooler weather to plant, but we’re having fun planning.

And the really sad thing about Pawlenty’s comment is that the Fox-infused Republican base will lap it up as surely as they do the Gospel.