STATE OF THE UNION NOT SO GOOD

State of the Union

President Obama’s State of the Union speech, given before Congress late Tuesday, took me back fifty years.

In October 1964, the British people voted into power a Labour (socialist) government after thirteen years of Conservative rule.

Obama’s promises last night reminded me of the Labour government’s agenda.

The theme running through both was this:   government will take care of you, government will provide everything.

Except for a vague tax on the wealthy, nothing was really said about how all these programs will be paid for.

Most people are aware that the wealthy can afford expensive tax accountants who help them to reduce their tax obligations, sometimes down to zero.   Nothing is going to change that.   The president and members of Congress are not about to become paupers because of new taxes – they will find a way around them, just as other wealthy people will do.

Mr. Obama promised more help for the middle class.   The term “middle class” has a different meaning in the US to what it means elsewhere, as Sky News pointed out the following day.   The middle class in the US is mostly working class people who own their own homes and have been struggling to make ends meet for quite some time.   The biggest challenges they face are rising health care costs and falling wages and unemployment.   It’s difficult to see how taxing the rich will help them.

But the promises do provide for a massive expansion of government, which will only add to the burdens of the middle class.

A few days ago, I saw, also on Sky News, a massive fire burning in South Oxfordshire in the UK.   An extensive building was on fire, the result of arson.   The person covering the fire explained that 440 people worked in this building, which served the community in various ways, including housing.   That’s 440 jobs that did not exist seventy years ago – 440 jobs to serve a relatively small number of people in the southern part of one county!

This is what the US is headed for – bigger government programs mean bigger government buildings and bigger (higher) taxes.   If history is any guide, that tax burden will fall mainly on the middle class, the ordinary people who cannot afford expensive accountants to take advantage of the inevitable loopholes.

Government is always expanding.   Here in Michigan, there is a proposal before the electorate to increase the sales tax to pay for road repair.   But it doesn’t seem that long ago that the gas tax was increased to pay for roads.   Meanwhile, the state has had to give $191 million to Detroit to help bail the city out.   An additional high figure (close to $100 million) is being allocated to build a new “Welcome Center” at the Capitol.

It never ends.

That’s exactly what God said when He warned the Israelites what would happen when they asked for a king, for a human form of government like all the other nations, choosing to reject the theocratic government He had given them.

In I Samuel 8:5, the elders of Israel asked Samuel to “make us a king to judge us like all the other nations.”  God granted them their desire, but forewarned them (v. 9) of what to expect, to “show them the behavior of the king who will reign over them.”

In a long and very descriptive passage beginning in verse 11, God showed them how the king would take more and more of their wealth to pay for what he wanted, whether it be soldiers, servants (government employees) or just spending in general.

He concludes with these words:   “And you will cry out in that day because of your king whom you have chosen for yourselves, and the Lord will not hear you in that day” (v. 18).

Of note, here is the expression “your king whom you have chosen.” This passage includes democratically elected presidents, as well as kings.

What it’s saying is that governments inevitably expand.   The more government programs we have, the more money government needs. And, as government is inherently wasteful and generally inept, the burdens on the people grow and grow.   Dissatisfaction with the state of the economy has been evident in the polls for a few years – the people are already crying out!

However, in a democracy, the people only have themselves to blame.

Fortunately, Mr. Obama, a Democrat, is unlikely to find any support for his programs in the Republican controlled Congress.   However, programs already in place continue to grow.   It’s doubtful that even a Republican Congress will be able to reverse them.

The 1964 Labor government in England was a turning point.   Three years after taking office, thanks to their profligacy, the country had to devalue its currency against the dollar.   This led to the collapse of the sterling area, made up of mostly former British colonies that traded in the British currency, a system that meant they kept most of their financial assets in London.   Twelve years later, Britain had to turn to the International Monetary Fund for a bail-out.   It wasn’t until Margaret Thatcher became Prime Minister in 1979 that the country started to turn around.

Mrs. Thatcher believed in sound money, otherwise known as living within your means.   There was no evidence of that Tuesday night when the President addressed the nation in his annual State of the Union address.

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