Only sharing the pain will save the U.S. economy

by Gerry Warner

Cranbrook Daily Townsman

“April is the cruellest month,” said poet T.S. Eliot in “The Wasteland” many years ago in the aftermath of World War I. Perhaps if Eliot was alive today he would be revising his opus to say August is the cruellest month as it's certainly looking that way as the U.S. teeters on the edge of financial ruin with no deal reached yet on its government debt ceiling crisis.

Put simply, the U.S. federal government spends more every day than it takes in. The federal deficit is currently $1.3 trillion and rising. The accumulated debt (all the deficits put together) is $14 trillion and rising and the maximum the U.S. is allowed to borrow by law is $14.3 trillion. Hence the fateful date of Aug. 2 when it's calculated that government borrowing costs will exceed $14.3 trillion and the U.S. will default on its loans.

And if that happens all hell will certainly break loose.

The reason is simple. Like it or not, the U.S. dollar is still the coin of the realm, the world's leading currency and the main foundation of the world's economy. U.S. federal treasury bills are still considered the safest investment and the best security in the world and if this were to change we would enter uncharted territory and a crisis in business confidence that could trigger another recession or worse. Much worse!

But the operative word above is “if” because it's in virtually no one's best interests for this to happen, including all of us who live outside U.S. borders. Yet the clock keeps ticking, the markets continue to slide, gold keeps going up and the politicians talk, but still no deal.

The obvious solution, at least in the short term, is to raise the debt ceiling yet again and it would be once more “business as usual.” But for obvious reasons this so-called “solution” carries little appeal because when you get into the trillions the numbers no longer make sense. Debt on this scale scares everyone. There has to be a better way. If you and I budgeted our affairs this way we would be living under a bridge by now. Something has to change. But what is that elusive something?

The constant refrain of politicians on the right in both the U.S. and Canada is we've got to cut government spending. That sounds fine until you look at the record. In the U.S., Republican Presidents Ronald Reagan and George Bush raised the debt ceiling 25 times between them while President Bill Clinton left office with a balanced budget. In Canada, former Liberal finance minister Paul Martin balanced the budget and began to reduce the debt, but both have climbed again under Conservative Prime Minister Stephen Harper.

In other words, politicians on the right talk the talk, but don't seem to walk the walk in both Canada and the U.S. Obama, in fact, has agreed to huge spending cuts even in the U.S. medicaid program yet the Republicans – pushed by their loony Tea Party members – keep calling for more and reject Obama's proposal for modest tax increases to help pay down the debt.

Well, no one likes to pay more taxes including the owners of corporate jets as Obama points out. But it's no different here in B.C., as columnist Paul Willcocks revealed in this paper last week with HST figures released by Victoria. According to B.C. Public Accounts, during the first nine months the HST was in effect, the new tax pulled in around $467 million-a-month compared to $392 million-a-month the PST brought in the previous year. This amounts to a 19 per cent increase or $210-a-month for every man, woman and child in the province while corporations and businesses got close to a $2 billion tax break .

I guess that's what's called voodoo economics – those with less pay more, the rich pay less and our grandchildren pick up the debt.

But surely this can't go on. If the U.S. falls, Canada won't be far behind and neither will the rest of the world. Even with the Tea Party types claiming God has ordained a tax cut, we all have to share the pain including Canadians with the highest per capita household debt in the world.

Or as the oracle once said there are three things you can always count on – birth, death and taxes – but there's no reason why taxes can't be fair on both sides of the border.

– 30 –

Brave words before Everest adventure

 

It's time for another bucket list adventure and who cares about elections? There are more important things in life like completing your bucket list, and by the time you read this, I should be doing just that in exotic Nepal, home to eight of the highest mountains in the world, including the highest of them all – Mount Everest.

No, I'm not climbing the 29,035 ft. peak (you don't insult Everest by measuring it in meters) but I hope to trek into the base of the mountain the Tibetans call “Chomolugma,” Goddess Mother of the World and was first put on the map in 1865 by Andrew Waugh of the Royal Geographical Society and named for Sir George Everest, the former chief of the famed society.

Being raised in the mountains of the Kootenays, I have thought, read and dreamed about Everest all my life and can even remember the breathtaking announcement on the radio May 29, 1953 when New Zealand beekeeper Sir Edmund Hillary and Sherpa Tenzing Norgay summited the highest prominence on earth. What an exciting day! For many of us, it even outshone the Coronation of Queen Elizabeth which happened less than a month later. My God, I'm getting old!

Years later, and I mean years, the first words that Hillary uttered when he returned to base camp were reported – “we knocked the bastard off.” Spoken like a man and considering all the lives (more than 300) lost on Everest before and since Hillary and Norgay's dramatic first ascent, a little cussing is more than understandable.

Then, of course, there's the other name most often associated with Everest, the man that in response to a New York reporter uttered the most famous phrase in the history of mountaineering – “because it's there.”

Most people today think Hillary spoke the immortal words. Well, he didn't. It was George Leigh Mallory in 1923 in response to a New York Times reporter and many others who kept asking the why question. Mallory apparently was incredulous (and a little irritated) that such a question would even be asked, considering the glory of achieving the first ascent of Everest. Less than a year later Mallory, and his climbing partner Andrew “Sandy” Irvine, were dead after succumbing to Everest's cruel slopes less than 2,000 feet from the top though to this day some believe the pair may have made it. Most regard it as highly unlikely but if you want to stir up a passionate mountaineering debate just say you think Mallory and Irvine made it. It's one of the most controversial issues in mountain climbing lore.

As for yours truly, all I'm hoping to do is to get to Everest base camp at 17,500 ft, almost twice as high as Mt. Fisher, and if I'm lucky and can handle the altitude, I may make it to the top of Kala Patthar, which means “black rock” in Nepali and which provides a breathtaking, unobstructed view of Everest and the great peaks surrounding it, Lhoste, Nuptse, Ama Dablam and others. You actually can't see Everest from base camp because it's too close. So if I make it to the top of Kala Patthar, about 800 feet above base camp, and get to see the Great Panoramic View of Everest and the others, I'm not ashamed to say I'll probably cry.

I've waited for this all my life.

The rest of the trip should be fascinating as well. I'll be spending about a week in Kathmandu, the capital of Nepal, and one of the most interesting and exotic capital cities in the world in its own right. Two of the world's great religions meet in Kathmandu – Buddhism and Hinduism – and the city is chock-a-block full of temples, shrines and monasteries as well as some of the most intriguing and colorful tourist attractions to be seen anywhere in the Third World. But I've also been warned that Kathmandu also contains some of the worst poverty and pollution that you'll experience abroad and only recently emerged from a civil war.

I plan on visiting an orphanage while I'm there and immersing myself in a culture that is as different as the moon from what we know here. This should be a hell of an experience and one that I look forward to reporting on while I'm there (if the Internet works properly) and when I get home.

And when I get back from Kathmandu and Everest's shadow, I'm sure home will never seem quite the same.

– 30 –

Let's all hear it for a great and enigmatic Canadian

Yesterday marked what would have been the 100^th birthday of possibly the most influential Canadian of our time. No Martha, it's not Wayne Gretzky, Celine Dionne or Pierre Trudeau. It's a Canadian that few Canadians understand. Nor does anyone else for that matter. But more than a generation ago, this Canadian predicted the world we'd be living in today and his prediction has come true with a vengeance.

Marshall McLuhan, the communication theorist whose groundbreaking 1964 book “Understanding Media” coined the famous expression “the medium is the message,” an idea that invokes great controversy even today and who also coined the expression “the global village,” predicting the advent of the world wide web 30 years before the web became a reality.

This alone should have been enough to win a Noble Prize but McLuhan was never so honoured quite possibly because most people, including some of the brightest minds in academia, just didn't get it when it came to his prescient and far-reaching ideas. And truth to say, I'm one of them even though I entered university a year after “Understanding Media” was first published and McLuhan's reputation was approaching its zenith. And it's only now, after almost 40 years in the media business, that I'm beginning to understand what the Great Man was getting at and quite frankly it frightens me in many ways especially when I look at the state of the world today.

As best as this technologically-challenged person can understand it, what McLuhan meant by “the medium is the message” is that the form (medium) by which the message is carried is often more important than the content of the message itself. On the surface, this appears somewhat nonsensical and deceptively simple, but when analyzed by minds greater than mine some extremely profound meaning results.

Look at it this way. If you could look through some great monitor or screen and see all the trillions of pieces of information circulating in cyberspace at any given nano-second much of it would be trivial, silly and of no consequence. In fact, it's often said the biggest batch of electro-magnetic “content” circulating on the Net is pornography though you couldn't prove it by me. Nevertheless, trivial or not, pornographic or not, who would deny that the Internet (the medium) is by far the biggest single influence on society today and changing it in ways that we can hardly imagine?

Without the Internet, there would be no social media, file sharing, instant messaging, email, music, movies and news “on demand.” Look at how this has changed our lives. Without the Internet and its accessories like cell phones, there would be no “Arab spring,” like the smart-phone led revolutions in Egypt and Libya and dictatorships like Syria would still be able to keep their people ignorant and compliant. Information is power and that power is now available to everyone with a battery and an iPhone.

McLuhan pointed out that every time a new technology is invented there are unforeseen consequences because people are much more interested in the technology itself than what it will ultimately do. A light bulb, he once said, was inert in itself, but by extending the human day and enabling people to work indoors at all hours, it changed the world.

In developing his ideas, McLuhan often relied on Harold Innis, another Canadian communication theorist and University of Toronto professor who said when we change our tools we change ourselves. A professor at Columbia University claims this is already happening with the Net, which people are relying on more and more to do their thinking for them instead of thinking for themselves. Psychologist Betsy Sparrow calls this the “Goggle Effect” and says search engines like Goggle and Yahoo are making us dumber and more dependent on our computers, smart phones, tablets and the like.

You have to wonder if McLuhan was alive today what he would think of the “Global Village” he predicted. Would he see it as a wonderful new world order where everyone was growing happier and wiser in a great, on-line, electronic gestalt or would he see it as a Brave New World of listless people devoid of individuality and incapable of original thought?

Whatever the case, this is one question that Goggle can't answer.