“A joy it will be one day, perhaps, to remember even this.”
This beautiful passage taken from book I, line 203 of Vergil’s Aeneid has been running through my mind for the past several months. We find Aeneas trying to console what’s left of his troops as they lay shipwrecked on the shores of Carthage. I have seen a lot of translations of this line from many different scholars, but it is Robert Fagles’ most recent translation that truly captures the gravity of what Aeneas and Vergil are trying to say. The word “perhaps” leaves the reader recognizing that it may not be pleasing to remember even this.
As a student of history, it is advisable to find certain lessons passed down from our ancestors and apply them today. In thinking about Aeneas’s words in a modern sense, I find myself drawn into today’s economic turmoil. When looking at the mess today, how can we set a policy that will be pleasing to reflect on moving into the future.
At no time in American history have we seen Government spending and action on such a broad, overarching scale. It seems that with every passing day, the lawmakers of our nation present new measures of spending that will effectively enslave future generations. If we look historically to the view of debts, we find in a letter dated September 6, 1789, Thomas Jefferson wrote to his friend James Madison the eloquent words: “…that the earth belongs in usufruct to the living.” Jefferson explains that the actions of one generation, as determined by the laws of nature, cannot impose obstructions to the life of those in the future. Jefferson is speaking directly to the issue of debt, and its effects on future generations. This can be more simply understood through a case study: if one generation were to pass, say, a $800 billion spending bill, money that the government does not have, future generations will be forced to repay the debt, though they had no say in the measure. If we are to accept the case study, Jefferson would conclude that future generations will forfeit their natural rights of life, liberty and property through the actions of which they had no say.
Jefferson proceeds into several, more radical conclusions with his argument, which can be rejected due to practical issues, but a portion of Madison’s response should be viewed as explaining a fair extent of debt assumption by one generation: through the protection of natural rights with regards to war. Madison’s summation is that if a nation is invaded, attacked, or even at war, it becomes suitable to incur debt to protect the natural rights of future generations. Madison effectively establishes a fair use of Government power in this passage.
Fast forward to the present day; several entities would attempt to persuade the American people that the current spending actions of the Federal Government are suitable in protecting the natural rights of future generations. We are offered a Keynesian solution to our current fiscal dilemma, similar to what was used in the 1930’s and the 1970’s in order to “jumpstart” the American economy. But is it not the case that the government actions of the 1970’s, for example, have caused the current fiscal issues of today? If we look to Government programs from that time: the Community Reinvestment Act, further protection of labor unions, & etc… a direct correlation can be drawn to fiscal issues within today’s housing industry collapse, as well as the hijacking of the auto industry by labor unions.
Let us also consider the idea that the Federal Reserve can simply print more money to help curb economic constraints like unemployment. The direct effect of such an action would be to create assured inflation within the system. F. A. Hayek spoke in an interview with Meet the Press on June 6, 1975 regarding similar issues facing the global economy. Bluntly stating: “All inflation is ultimately the problem of activities which Government determines and can control.” Hayek debunks the notion that the Government simply spending more will fix all of our problems. He continues “…and all inflations have been stopped in the past by the Government stopping creating money or preventing the Central Bank from creating money.” When pushed further by Irving Levine, Hayek also states that it is the creation of aggregate demand to curb unemployment through Keynesian activities that also played a major role in creating the inflation of the 1970’s.
So what are the effective solutions? History has taught our generation that government creating and spending money does not serve as a solution moving into the future. At its very minimum, it simply places the burden of debt on generations that had no say in the matter. In 1975 Hayek warned that problems government was creating would become evident in roughly twenty years, it would appear he was correct.
We as a generation must take into consideration not only the results of our present actions, but also what effects will be imposed on future generations, our children’s generation. A truly effective solution would be to have the kind of government action taken to reduce corporate tax rates to invite business solutions, a strict reduction of labor unions power so that they cannot simply strangle an entire states economy, and most certainly NOT sending the American economy further into debt, regardless of which party does it. We mustn’t allow our fear of a natural correction in an economic cycle cloud our judgment on what actions should be taken. We must, as Hayek said, remove the desire to spend more to help solve solutions, especially when the result effectively enslaves future generations to debt.
Forsan et haec olim meminisse juvabit.