Lack Of Leadership
The problem starts with the elephant in the room, a government devoid of leadership. Do not read political party into that statement. Leadership is simply missing, no qualifiers. I am certain congress must have a couple of people with leadership qualities; the Gang of Six comes to mind. But they are not the ones getting the press. Headlines are derived from rhetoric, arguments, and bombastic speeches rather than cooperation and compromise. Politicians need headlines to make constituents think they are doing something. The US went through weeks of proposals pushing agendas to use as fodder in future speeches for the next election. The minority and majority leaders of the House and the Senate were spineless, self-serving puppets to the next election, unable to stand up and admit the US needs to reduce scope and increase revenue. If this were my project, they would be the first to go in an attempt to get people working together.
Define The Scope
The next step is to make sure we are working on the right scope. In every bill we seem to have a new project charter—industry bailout, healthcare, budget, debt ceiling... oh, what about jobs? We need a vision and each project task needs to map to that vision. If the goal is to eliminated the deficit, balance our budget, help industry create jobs, and protect the American people from attacks (from terrorists and corporations) on their inalienable right for life, liberty, and the pursuit of happiness then every action must be directed that way. Granted, this is a pretty big plate. It is impossible to complete this project in a two or six year term. This is a multi-decade plan for which many of us will not live to see its completion. Yes, folks, twenty to thirty years followed by a maintenance plan—no more instant gratification and, yes, a lot of work. Our forefathers did not build this country engaging in the colonial equivalent of watching TV, eating Cheetos, and attending tailgate parties while wearing hats that resembled cheese wedges. Everyone pulled their weight and made sacrifice.
Work With The Stakeholders
Next, we need to talk to the stakeholders—the citizens of the United States, the leaders of foreign countries that want our financial and military assistance, and the countries that loan us money. All three need to sacrifice. Fewer services, higher expense, less profit. Stakeholders will need to suffice with cuts in what the government provides (from weapons and world policing, to farm subsidies and welfare), increases in the expense of services (raise taxes and international cooperation), and reduction in profit (lower interest rates). Will anyone be happy with this plan? Hardly, everyone will lose something. It is nothing more than applying the rule of triple constraints. Set a time lime, determine the financial needs in that time, and address the required budget by increasing revenue and decreasing scope.
The Current Dilemma
This seems to oversimplify a huge problem; however, it is the defined approach that is needed. Unless congress takes this simple objective approach—the process that has fixed hundreds of projects—they will not address the problem. Instead, they are embroiled in creating proposals to get headlines and garner votes from a small set of voters. They are stuck in an egotistical, aggrandizing, self-serving promotion forgetting about the country they serve. If it is true that less than 20% of the people in the US are opposed to a tax increase, why pander to them? Our congress is not beholden to the American people; they are shackled to the campaign donor. They are focused on what is good for the politician, not the stakeholders.
Standard and Poors
Just like any business with inadequate leadership, Standard and Poors appropriately dropped the S&P bond rating. They rightfully see no leadership, no cooperation, and, the coup de grâce, no one suggesting a plan to solve the problem. They look at it as I do when called in to bid a recovery job. I need one question answered, "Does the client really admit they have a problem to solve?" Without that realization the sacrifices will not be made. In Congress, we have one side blaming the other. They deliver ultimatums (i.e. we cannot increase revenue), not compromise. In other words, our "leaders" cannot make the sacrifices required to fix this problem, yet they expect everyone else to. They have turned into the best government money can buy.
On every job I take, I have one ace up my sleeve. If you do not like what I am telling you, fire me. I am not afraid to lose my job. Our congress men and women are afraid to lose their jobs. They are drunk on the beltway power. They need to revert to the basics and understand simple financial rules. Once they get that lesson, they need to learn how to lead and not be afraid to use it.