The other day, I heard a news story discussing whether the message out of the White House was sufficiently upbeat on the steps being taken toward fixing the economy. There was some discussion relating to the fact that the message was not all that upbeat, especially when dealing with the tough choices that must be made in order to put the economy back on track. The question ultimately centers on whether the illusion of an improving economy is more important to economic growth than the effect of making the hard choices required to actually fix the economy.
There’s a lot of psychology that goes into the status of an economy, but fundamentals will always win out in the end. Ultimately, an economy with good fundamentals will create the good feelings required to feed a growing economy.
If you’re on a journey and you find you’re going the wrong way, why wouldn’t you be happy in your choice to turn back and go in the right direction? The road ahead might look shiny and happy. If, however, you know that it ultimately will lead to ruin, why wouldn’t you be happy to turn around and head in the right direction? Even if the right direction is uphill and the road is a little rough, at least you’d be heading in the right direction.
The answer is a really simple question: Where are you focused? If you are focused on the short term, you don’t turn around. If you’re looking toward the long term, then you make the tough choices for the future. That’s how you get where you want to get go without relying on happenstance.
I have a lot of clients that only see today. If they can stay out of jail today, that’s all they care about. They don’t look at the future. They don’t care how much extra time they might do in jail if they don’t take a deal. They only care about not going to jail today.
In many ways, that’s the way we’ve been running the U.S. economy. We don’t want to pay for what we get today, so we borrow from the future. We don’t want to wait; we want it now. We have disregarded what it will cost in the future as long as we get it today. Our entire economy is built on borrowing from the future.
We’ve had years of supply side economics intertwined with the unraveling of the financial regulatory system. Of course, our use of the theory of supply side economics has been limited to the cutting taxes portion without regard for the rest of the theory, which requires the raising of taxes during strong economic times. Who wants to raise taxes? That’s for those looking long term. There’s no fun in that.
There’s nothing wrong with being happy about making tough choices. Tough choices help you properly chart your course for the long term. As long as you know in your heart you’re making the right choices, then there’s no reason to be anything but upbeat. Sometimes, we have to make the best decision we can and be prepared to alter the course if needed. The trick is being honest about the decision and doing the best we can. That’s all we can do.
Making decisions about the future is never easy. We’re not relieved of making decisions about the future by looking only at the short term. Short term decisions make decisions for the long term by default. That’s true for everyone, even those of us in the CHEAP SEATS!
Bill James is a co-founder of the James Law Firm with offices in Little Rock, Conway and Fayetteville, Arkansas. His primary area of practice is criminal defense. He can be contacted at Bill@JamesFirm.com