Monday, April 26, 2010

Why do public officials struggle with the truth?

If there is a singular problem with our global society today it is that we're all liars. There is no honor in telling the truth because it simply gets you voted out of office. A-Rod lied, Tiger lied, Wall Street lied, the college kids on 60 minutes last night taking Adderall to enhance their test taking, etc, etc.

The problems in Europe are far from over as rioting continued to spread in Greece and their politicians stated that debt restructuring was off the table. Of course, it's not off the table but that would be stating the truth and we can't have that.

Consider the case of the first-time home buyer tax credit. We've been flooded with stories about how everyone is knocking down Realtors' doors to sign a contract before Friday to get their $8k rebate from the government. However, the truth is a little less buzzworthy - according to the NY Times -

"Though the Treasury Department and the real estate industry have termed the program a success, helping 1.8 million people buy homes, many tax policy experts say it has been singularly cost-ineffective: most of the $12.6 billion in credits through end of February was collected by people who would have bought homes anyway or who in some cases were not even eligible.

For every home buyer like the Greens, real estate agents say there are at least three others who collected the credit even though they would have bought without it. That means for each new buyer who was truly lured into the market by the credit, the federal government paid more than $30,000."

But let's not let the facts get in the way of a good story.

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Now for the downside of telling the truth... Consider Gov. Paterson's op-ed "Borrowing Our Way to Failure".

"NEW YORK’S financial problems are not overly complicated. The state is on track to spend a staggering $60 billion more than it receives in recurring revenues over the next four years. Simple arithmetic explains how we got to this point: Our expenses are consistently exceeding our income. We are headed off a financial cliff.

Borrowing may make the lives of Albany politicians easier. It may delay our inevitable day of fiscal reckoning past one more November election. But borrowing to help close our budget deficit, by itself, does not do a single thing to help improve our long-term fiscal condition. In fact, it makes an already bad situation worse.

Those of us in Albany were elected to make difficult decisions. This may be hard in the short term, but it is the only responsible path forward if we want to emerge from this crisis and build toward a strong fiscal and economic recovery."

Gov. Paterson is a flawed politician and he has very little chance of receiving the Democratic nomination but he has demonstrated a great deal of honesty in dealing with our budget crisis. I'd bet he'd be headed for re-election if he authorized a $10 billion bond to fund the budget gap and increase spending for 1/2 filled prisons.

More politicians would probably be "one and done" if they followed my golden rule

"Tell the Truth --- All of the time".

Cheers!

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