CRIME AND PUNISHMENT
Like the Biblical Job Americans have had much taken away from them. Millions have lost their jobs, their homes and have watched the value of their pensions shrink. They are unable to move, consider having children, or even filing for divorce.
All of this they’ve brought upon themselves. They have behaved badly. They have run up excessive levels of indebtedness on credit cards. They bought homes they could not afford. They borrowed on the equity of their existing property, and withdrew funds from their retirement accounts. What profligacy. Worse, they stopped saving money and instead devoted themselves to unabated consumption. And they insisted that the government help maintain their life styles by spending more on education, health care, medications, housing, unemployment benefits, etc., forcing officials to borrow heavily and expand the national debt to unprecedented levels.
Such widespread excess too long tolerated had to stop. But more than that, the people needed to be punished for their sins. When the children of Israel went astray, the Old Testament God sent prophets to chastise them, urging their return to the path of righteousness and threatening them with God’s wrath. And so Americans were told that only through austerity could they atone for their transgressions and regain the moral mainstream. Indulgence must cease and be replaced by substantial belt tightening and self-control. They will, no doubt, endure pain, but then regeneration depends upon paying the price. Money must be put aside and saved, borrowing restrained and family budgets pruned of nonessential expenditures. Meanwhile, the government must itself learn to live within its means, cutting back or eliminating programs that are too costly, inefficient, of marginal value, or that sap self- reliance. Austerity must become the medicine of choice, its value recognized, its side effects and adverse reactions tolerated.
The call for austerity enjoys widespread support because it conforms to a well-established narrative. Misdeeds cannot go unpunished, guilt must be acknowledged; repentance demonstrated. When bubbles burst – as they always do – isn’t a return to sanity in order? Most people, beginning in childhood, understand instinctively that misbehavior comes at a price. Privileges are lost, possessions removed, pleasures cancelled or curtailed. With austerity comes punishment and cleansing, the necessary ingredients for future recovery.
Has the gospel of austerity gone unchallenged? To be sure the principal focus has been on government spending. Cut outlays, the argument goes, and confidence will be restored; reduce burdensome interest payments on the debt and watch the economy regain its vitality. But government cutbacks don’t come easily when a host of beneficiaries employ pressure and resist any such reductions. Besides which, critics insist, that if government spending stalls (which it has most decidedly on the state and local level), expect the economy to sputter, or worse, decline.
Austerity as it applies to individuals and families is equally problematical. Tightening the purse strings may be what’s required and restoring individual balance sheets a valuable goal, but promises to do so prove hard to keep. Consumption may not be addictive, but spending habits are hard to break. Besides which, the economy depends heavily upon consumer spending and will suffer if purchases lag.
Still, the siren call for self-control and austerity will not be silenced. A binge after all requires a purge, excess demands redress, bad behavior, punishment. We’ve been told that since we were kids.