It takes a governor, I've come to think, to make a competent president. You're not ready for the presidency until you've actually headed a government. Senators and congressman learn a few leadership skills, I guess-but they can never point to their desks and say: "The buck stops here!" A governor can say that.
That's why I paid attention the other day when I saw something that came from the pen of the governor of Indiana. I won't prejudice you politically just yet by telling you his name. I do want to excerpt a few brief comments that come, as I mentioned, only with the experience that a governor brings to the table. Read with that thought in mind:
"State government finances are a wreck. The drop in tax receipts is the worst in a half century. Fewer than 10 states ended the last fiscal year with significant reserves, and three-fourths have deficits exceeding 10 percent of their budgets. Only an emergency infusion of printed federal funny money is keeping most state boats afloat right now."
"America is on an unsustainable fiscal path that threatens our future. Changing course is imperative. . . ."
"Most governors I've talked to are so busy bailing that they haven't checked the long-range forecast. What the radar tells me is that we ain't seen nothing yet. What we are being hit by isn't a tropical storm that will come and go, with sunshine soon to follow. It's much more likely that we're facing a near permanent reduction in state tax revenues that will require us to reduce the size and scope of our state governments. The time to prepare for this new reality is already at hand."
"Last month the Office of Management and Budget predicted that the national debt will increase by $9 trillion over the next decade-$2 trillion more than forecast just four months earlier. Government net interest payments exceed $1 trillion in 2019, up from $382 billion this year. Because projected deficits exceed projected economic growth, the gap will be self-perpetuating."
"The coming state government reset will be particularly wrenching after the happy binge that preceded this last recession. During the last decade, states increased their spending by an average of 6 percent per year, gusting to 8 percent during 2007-08. Much of the government institutions built up in those years will now have to be dismantled."
"The consequences of all this will not be benign. A world saturated with U.S. currency will eventually look elsewhere to invest, causing the dollar's value to drop. Foreign creditors, their confidence shaken by our fiscal profligacy, will demand higher payments to keep holding our debt. The net effect will be 'stagflation,' that pernicious combination of slower growth, higher inflation and interest rates, and lower living standards. . . ."
"Even if Americans wanted to go back to their high spending, high-borrowing ways, will anyone lend them the funds to spend like it's 2007 all over again? Consumer credit will remain tighter as a matter of both sound business and new government regulation. Home equity appreciation is gone as a huge source of collateral, even if lenders were either willing or permitted to loan freely against it."
"These events will diminish our global influence, because fiscal strength is essential to diplomatic leverage, military might, and national significance. No great nation can rely upon the generosity of strangers or the forbearance of potential adversaries to meet its security needs. America is doing both. China uses its monetary reserves to curry favor in developing countries once in the U.S. sphere of influence; we must borrow to pay for the wars in Iraq and Afghanistan."
OK. Time to end my little game. It's time to tell you that all these sober paragraphs-with every word coming verbatim from the pen of an Indiana governor-in fact come from two very different Indiana governors. The Hoosiers' current governor, Republican Mitch Daniels, wrote the first and then every alternate paragraph. Indiana's previous governor, Democrat Evan Bayh (now a U.S. senator), wrote all the paragraphs in italics. Both men's thoughts appeared in recent weeks as guest editorials in The Wall Street Journal.
It's unsettling how neatly the counsel of a thoroughgoing conservative and that of a through-and-through liberal tend to mesh. Doesn't it grab your attention when political opposites agree? And could it be that such consistency comes because the thinking of both has been tested by the fires of actually administering the affairs of a state? Just maybe, we ought to be keeping our eyes on what happens in the Hoosier state over the next few months.
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