Posted by Lending Club :: July 3, 2008 @ 11:52 am
Our nation is no stranger to financial difficulty. Let's look back a few centuries...
During the Revolutionary War, funding severely hampered our efforts to fight the British. The Continental Dollar created during the Second Continental Congress in 1775 faced competition not only from states' individual currencies, but from British counterfeiters as well.
Needless to say, our nation did not start out on the most solid of financial footing.
As the British invaded the South in 1780, the financial situation of the fledgling Revolution got even bleaker. Britain continued to counterfeit the Continental dollar; states kept printing more of their currency. Inflation was rampant. Congress increasingly began to rely on domestic and French loans. The confiscation of property was even authorized.
Even after the victory over the British, it wasn't until 1787 when Congress met to completely revise the Articles of Confederation (with the Constitution of course) that some stabilization was achieved. Viewed from an economic standpoint, the Constitution was finally able to solve many of our early financial problems. It allowed regulation of interstate commerce, and the ability of a national government to tax and protect its growing borders in the West. Our Constitution is a very powerful financial document indeed.
So, why the history lesson of our nations early financial woes?
Once again, as a nation we are facing circumstances where our finances might hamper our ability to flourish. Only this time, we have no British empire to blame.
Our founding fathers faced financial crises creating a new country. We often face financial difficulty because of rampant consumerism and a culture of entitlement: We bought that big house, and we just had to have that new car. I imagine if the founders could see what modern-day Americans go into debt for, they would be flabbergasted. Getting a loan to finance a new business venture or to pay off high-interest credit cards can be good debt choices. The truth though, is that most of our modern-day debt is not "good debt". It's an accumulation of eating out every day, and of buying that latest gadget we "must have". It's the mentality that we not only can have - but deserve - whatever we desire at the drop of hat.
Our entitlement mentality needs to be broken. It's a mentality that is flawed. So as you celebrate our Nation's Independence this Friday, make a commitment to declare your independence from bad debt. It may take some time to get your new financial footing set, but at least you don't have to convene a Congress to get it done!
Have a great and safe 4th of July!
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9 Comments
It is the federal reserve system, an unconstitutional central bank
that controls the issuance of money, that is the problem. this bank
is unconstitutional but the banking cartel that controls the bank
has a huge control and influence that most in congress are too
fearful to stand against it, or are completely ignorant of the
history of the federal reserve system.
Debt has become an important part of our economy. Its converse is
interest.
I wholeheartedly agree. Looking to the founding fathers is
something every American must do in order to get a grasp on the
current climate.
In David McCullough's Biography "John Adams" We see that while John
Adams was frugal and saw the importance of being in no mans debt,
the other founding fathers were not so inclined. Thomas Jefferson
spent beyond his means throughout his life. Adams even sought Dutch
loans to help fund the revolution, and his experience was drawn on
many times thereafter in securing other loans both for the Country
and Jefferson. It is however unfair to compare the two two eras as
then and until the 1800's there were debtors prisons and as
McCullough points out men were denied appointments due to past
bankruptcy's. Maybe we need to return to real consequences and
stigma before we'll learn our lesson.
Yes, everyone is guilty of consumerism and a feeling of self
entitlement. I also agree that everyone doesn't need the biggest
and best thing (try telling that to your wife who is friends with
the Jones' next door with a nice Porsche), but people still need to
spend to keep the economy going, otherwise how will anyone make any
money? If we only spent money for necessary things, the only way we
would make money is by selling our goods or services to other
countries. That's where the big problem lies, international trade.
Our government has let the huge corporations import from many
countries for a cheap price, while these countries have strict
rules for exporting to their countries, creating a nice sized
deficit! I say stop the imports from countries that have strict
policies of buying goods from us. Will that cause our cheap plastic
crap from being more expensive? No, but it's exactly that usually,
cheap plastic crap! I think the best thing to do is invest in
technology. That's the only way we've ever expanded as a country.
Just think if we would have been putting all the money for the Iraq
war into technology! Put that money into energy technology and I
guarantee the country would be better off (even half the money).
Those are only a couple variables in the whole picture, but I think
they are very important ones to put our country back on the right
track.
I think debt collectors are worse oppressors than the British ever
were.
Some good points. What's missing is the greed factor not only from
consumers but from big business also. The biggest debtor of all??
Our wasteful, pork barrel, overspending government.
Our debt level is very serious and need an attention of everyone in
politics and the community. This is not a new problem, we've have
lived in debt in our society for ages, but going to the levels we
are at now is a problem and needs to be eliminated as soon as
possible.
That we have lost our minds
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