The Brian Gongol Show on WHO Radio
Brian Gongol

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While the crisis du jour is the $700 billion deal to keep the credit and banking markets working, we're hardly doing ourselves any favors if we ignore the many other issues to which we should be paying attention. Like, for instance, the erosion of our friendships in Latin America. We warned of that risk in 2005, and yet little to nothing has been done to spread American goodwill among our neighbors to the south. There's a reason the Monroe Doctrine was one of the first major statements of public policy to come out of a United States government: Our neighbors are extremely important to our security.

The credit rescue package may or may not have been absolutely necessary -- but two consequences should be clear, even from today's perspective:
  1. We're going to pay double for the deal. Not only do we as taxpayers risk losing billions of dollars in case the plan doesn't work, we're also going to pay lots more thanks to higher interest rates. The US government is becoming a bigger credit risk than ever before, and that means its creditors are going to charge higher rates. That means our already far-too-large national debt is only going to grow faster unless we start acting like adults and paying it down.

  2. We as voters, taxpayers, and shareholders are going to have to start applying more pressure to our politicians (to enforce the rule of law) and the people who manage the companies whose shares we own (to act in our best interests, not their own). If we don't, we're going to have more financial calamities, more fiscal irresponsibility in Washington, and more steps toward socialism -- which is emphatically not what we need.
Here's a way we could make our financial system better without calling on the government to do more: Let's put the "mutual" back in mutual funds.

A couple of predictions from our Future Scale: All of these things should serve as reminders that we have to move beyond the mindset of "no policy without a crisis", a subject we've been talking about for more than a year. It's time to take a step back and stop swinging from emergency to emergency. What happened to the recent panics over energy prices? Global warming? Terrorism? Crumbling infrastructure? Iraq? If all we ever do is swing from crisis to crisis, we're never going to get the kind of world we deserve.

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