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DAVID KRUSE

By Staff | Aug 19, 2011

Perception is everything and the perception of a majority of Americans is about as bad as it has ever been. Many think America has been lost because they profess a need to “Take America Back.” That is not going to happen as the America that they remember has evolved.

Culture changes. Demographics change. America changes with it and so some have great difficulty dealing with what America is becoming, believing that these changes are decaying the structure of the country. Polls have never shown such pessimism before.

Right track-wrong track bias is heavily weighted toward the pessimists. Wars don’t end. Deficits threatened the country’s creditworthiness. Even events such as the killing of Osama bin Laden barely provided an uptick in the trend of pessimism.

Sour attitudes, not surprisingly, produce weak economic activity. Corporations sit on cash, banks are reluctant to lend, and government stimulus has been exhausted.

The full faith and credit of the U.S. is being questioned as never before. The tone in Washington has turned toxic. The President of the U.S. is taunted with the outbursts, “You lie,” personified as evil by the politically polarized public. If they will say vile things about the President in public, imagine what they must say in private. Who is really evil?

Partisanship has reached new extremes that shock retired politicians who remember days when members of Congress worked together representing the country first instead of the incendiary partisan rancor that divides enemy camps depicting compromise as an exercise in political weakness regardless of the cost. There is real hate between parties in Washington where extremism is considered a political virtue. Bad things have happened to America before, but always before, Americans would pull themselves out from whatever blow was taken.

Osama bin Laden may be dead, but Americans have not recovered from 9/11. Optimism was a casualty of the post 9/11 American attitude. Despite the $2 trillion spent by the U.S. on Homeland security and the war on terrorism, Americans do not feel save and secure.

About 78 percent believe that another major terrorist attack will take place in the U.S. in the next decade. 54 percent of Americans believe the Arab spring will either have no impact to reduce terrorism or actually make the threat worse; while 68 percent of Americans believe the past decade has been one of decline.

Americans are turning inward, with foreign policy taking a back seat to the 83 percent who feel the focus should be on domestic issues; in fact 47 percent believe the past decade was the worst in the past 100 years.

That should shock some of those who remember WW II. Americans fear themselves more than any outside threat – 66 percent of Americans believe the greatest threats to long-term stability in the U.S. will come from inside.

The worst attitude that is a huge change from past polling is that 52 percent of Americans now believe that their children will be worse off than they were. They see runaway deficits, political gridlock, skyrocketing health care costs as seemingly insurmountable obstacles for America.

There are two political camps in America … one that wants to prove the pessimists wrong and another that uses the pessimism, feeding it for political gain

Pollsters find blame spread around including the Bush administration, 23 percent; Obama administration, 20 percent, Congress 16 percent and Wall Street 6 percent. Personally, I could just go with all of the above, although maybe not in that precise order.

I share the unhappiness over the course that the country has taken the past decade, but I am not pessimistic about Americans. America doesn’t have a single problem that can’t be fixed, but the politicians are not going to do it until they have exhausted all other options and are forced to. Only the American people can start over.

As I see it, much of what is wrong today is because the politicians did not trust Americans. That is why they put $2 trillion for wars, the most costly of which was a war of choice on the credit card the past decade – because the leaders in Washington didn’t want to bother us with the cost.

In fact, they gave us tax cuts to make us feel better, fearful that if forced to pay cash for it, as they should have, public support for what they wanted to do would collapse. If the public refuses to pay for something, it is not something the country should be doing.

I have pointed out that the past decade was the “spend and borrow” decade, not the “tax and spend” decade. Democrats tax and spend. Republicans spend and borrow. If tax and spend would have been used instead of spend and borrow, U.S. deficits would not be so enormous as they are. Burdened by taxes, taxpayers would not have permitted the level of spending that occurred.

It didn’t work. The bill has come due. The Tea Party served a purpose to bring that stark reality home. A wise, experienced wealthy investor told me that nothing is ever as good as it seems and that nothing is ever as bad as it appears.

American pessimism should be taken as recognition that structural change must occur. The public realizes that politicians have been selling them a bill of goods, tax and spend ran its course a couple decades ago and borrow and spend has proven to be an even more proficient fiscal calamity.

Now we get to see how much damage that austerity taken to extreme as an overdose can do after years of out of control spending as Washington now slams on the brakes. The abrupt stop may now put us through the windshield onto the hood into another dip into Recession.

David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.

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