LEADERSHIP, WEALTH, AND HARD DECISIONS

One of the challenges of leadership is that sometimes leaders have to make some very hard decisions. A true leader sometimes has to make decisions that will not be popular, decisions that will not increase one’s approval, decisions that might even trigger temper tantrums and outbursts, but decisions that have to be made. Decisions that someone has to “man up to” and make. That’s why they are hard decisions.

For several years now many governments are facing some really hard choices about finances— spending, taxing, accountability, etc. Since the worldwide financial crisis of 2008, several of the European countries (Greece, Spain, etc.) have really struggled with this— with the threat of the entire country going bankrupt. Now the same challenge is beginning to show up in the United States.

For several weeks leading up to October 1 and then up to Oct. 17, our media gave us a front row seat to the “playing of politics” by our President and Congress as each spent lots of time demonizing the each other and pointing fingers as who is the real culprit about our financial problems. The “funny,” but sad, thing in watching and listening to all of this, to the political parties dancing around the issues, making their points, and quoting their “talking points” over and over was that all the while they were neglecting the big issue. Yes, they eventually came to an agreement and “kicked the can down the road,” so we’ll have to go through it again in January, yet all the while they essentially ignored the 800 pound gorilla in the room.

What is that 800 pound gorilla? The fact that we are spending more than we are making. It is the problem of an addiction that our country has—an addiction to impulsive and out-of-control spending. This addiction has now created a national debt of more than 17 trillion (see “Visualizing Trillions” at the end). And not only that, but we have the problem so bad that our Congressmen and Senators alike constantly sneak “pork” into every bill that Congress passes and that the President signs. And why? They put in the pork to win the votes of certain political and interest groups. This is the “politics as usual” that’s destroying our financial well-being.

While that is the basic or primary problem, there is the meta-problem. This is the problem of refusing to face the primary problem of over-spending. The meta-problem is refusing to make the hard choices regarding what to cut back on and how to bring the spending under control. I hardly ever hear anyone address that problem. The problem is that except for the rare exception—all of our

leaders seem to be cowards about these problems. Some of them will at least talk about it, but then when it comes down to actually doing something about it, the great majority are cowards.

All of us know that as individuals we cannot handle our finances in the same way that governments are handling their national finances. Who would even be able to keep borrowing and borrowing, even borrowing money for bread-and-butter expenses (food, shelter, transportation), and then borrow so much that it is more than a person can make in an entire year or more than all of their combined equity (or nationally, more than the whole economy), and keep “kicking the can down the road” crossing-their fingers and hoping that “it will work out”?

We all know better than that. That’s the fast track to bankruptcy and dissolvency. Yet before we would ever get to that point, we would cut back on spending, we would sell off things, we would be told that we have reached our borrowing limit and can borrow no more. Well, the President and Congress has a borrowing limit called the Debt Limit. But then every single year, under both Republican and Democratic administrations, they vote to raise it. Now isn’t that weird? I think it is weird! After all, what this is the purpose of having a Debt Limit if it never limits your spending? If every time you get to the limit, you then raise the limit, what’s the whole point of a limit?

Individually, you and I know that wealth is squandered and wealth-creation is undermined by an addictive spending pattern. The same is true nationally although that awareness does not seem to govern the thinking or action patterns of the leaders in Washington. Somehow they don’t seem to think of the financial responsibility that they have been given in the same way they think when it comes to spending their own money. In this, they are engaged in a form of irresponsibility and are acting as if there’s no consequences to what they are doing.

The solution to all of this is obvious and easy—well easy to say. It is an differently matter to do. It involves a change of behavior in our political leaders. It is going to require the development of new kinds of leaders. On the personal front, to change your own finances requires a change in your own self-leadership so that you think long-term, you think about consequences, you assume responsibility, and you make some hard decisions. Similarly with our political leaders— we need men and women who will stop with the “politics as usual” and think beyond their own vested interests and political parties.

Visualizing Trillions Just how much is a trillion dollars? If there was such a thing as a thousand dollar bill and if you had a stack of thousand-dollar bills in your hand— a million dollars would be only 4 inches high.

Now for a billion dollars, we have to multiple that handful of 4 inches for a million by 1000 and then the stack would be 4000 inches high. And 4000 inches is 333 feet or somewhere about 110 meters. That’s longer than a football field! But that’s just for one billion.

To now go to a trillion, multiple the 100+ yards or meters (approximately) by 1000 – and the stack is now 67 miles high. And that’s just one trillion. The US debt today is over 17 trillion, so multiple it the 67 miles by 17 — and now the stack is 1,139 miles high.