Wise Investment Versus Wasted Spending: Congress Better Learn the Difference

In the long term any successful business must eventually acquire good management of its resources-both financial and people. This requires spending in areas which return good value and cutting costs in areas that do not. A company with an especially strong product can avoid this requirement for a period but eventually the competitive forces of the marketplace take hold. Thus, there are hundreds of once imposing companies that became mediocre or bankrupt because of their management failures.

The analogy fits the US in the current global environment. We have enjoyed a powerful product made up of strong protection of individual freedom, intelligent aggressive citizens, and bountiful natural resources. This has allowed us to excel in providing advantages to our citizens and the world in spite of many missteps. The good treatment has made American citizenship a treasure valued around the world.

Unfortunately, we have allowed weak leaders and special interests to degrade our ability to serve the citizens. They have also created an investment deficit that if not corrected will override any other efforts at resurgence. To be effective we need to implement a wise investment plan of equal importance to any spending control program.

We have many reforms ahead, but one of the most important is to revitalize manufacturing. It is unconscionable that the Government and citizens allowed international trade to get so far out of hand. We are now in the position of asking other countries to agree to controlled trade balances between countries. This is an embarrassing attempt to correct a situation that our government should never have allowed to take root. With no real industrial plan and the only political talk directed at cutting spending rather than investing, the US is in a very weak negotiating position. China and Germany, through aggressive and wise industrial policies, have established large trade surpluses. They are not about to agree to give them up.

The result is that the new balances for the US can only be reached through the hard work of re-establishing a commanding industrial trade position. It requires investments for the future in research, development, education, and incentives for manufacturing in the US. The goal would be to allow our manufacturers to compete directly in the free global market. Faced with that strength by the US the other countries will be anxious to talk.

We desperately need our industrial leaders and the government to cooperatively attack this well known problem aggressively head on with a realistic and thoughtful plan.

But remember that this will require knowing the difference between wise investments and wasteful spending.