It is time We the Maids stopped career politicians from kicking the can down the road and start tackling and cleaning up the deficit mess before it is too late and America faces the unemployment and desperate times Greece, Spain, Portugal and many other European and African countries are confronted with today? After all, as House Speaker John Boehner said during the fiscal cliff negotiations, “Washington has a spending problem. Let’s be honest – we’re broke.”
So why are career politicians even talking government shutdown? Is this any way to run an economy that is broke? It is time We the Apathetic Maids sweep in the political reforms needed to recharge and restart the economy, starting with career politicians in Washington.
America took in $2.45 trillion in 2011 and spent $3.54 trillion, leaving us with a deficit of about $1.1 trillion. America can do that from time to time, but 2011 marked the fourth year in a row We the Apathetic Maids spent over $1 trillion more than we took in. Just in that time, we’ve borrowed more than $17,000 for each man, woman and child in America.
The interest payments on all that debt is a massive $258 billion a year. That is more than we spend on the departments of Commerce, Education, Interior, Energy, State, Homeland Security and Justice combined!
The Congressional Budget Office projects that if we don’t tackle some of this debt, our interest payments will soar to $1 trillion a year by 2023.
I agree with Sheila Bair, former chair of the FDIC and a Fortune magazine contributor, who wants to institute pay for performance for elected officials.
Pay for performance has improved management in the private sector. So why not try it with the folks in D.C.?
For instance, one-half of compensation for corporate directors is frequently paid in stock, which must be held for several years. The idea is to align their economic incentives with the long-term profitability of the company. There is no stock ownership in the federal government, obviously, but we do issue a lot of debt in the form of Treasury bonds. So why not start paying members of Congress and the president half of their compensation in 10-year Treasury debt, which they must hold until maturity. Members of Congress make roughly $180,000, so under this proposal, they would get $90,000 in cash and $90,000 in 10-year Treasuries. For the president, it would be $200,000 cash and $200,000 in T-bonds.
Most career politicians have never run a business or had to meet a payroll. Yet they are charged with running our nation’s economy and business
If the economy does well and if they get our fiscal house in order and institute pro-growth tax and spending policies, those 10-year bonds should hold their value. If not, those bonds become worthless. Aligning pay with long-term performance can be a good way to change politicians’ behavior for the better. Not only in America, but in China and the rest of the world.