Lessons from Europe: Unless you have been hiding in Attorney General Eric Holder’s “Fast and Furious” documents file, you know that trouble is brewing in Europe. Big trouble. Real big trouble. None of us know where it will go from here. But, I can see no good outcome. The experiment of monetary union without fiscal or political union has failed. Most of the solutions they are now discussing will simply delay the inevitable. Using debt that you have no plan to repay in order to pay other debts that you can’t repay doesn’t work with mortgages and will not work with governments. And, it is hard to even describe the political challenges they have over there. Look at the gridlock we have here with one country, one culture and 2 political parties. Now, imagine having 17 countries, dozens of cultures and a hundred political parties. I think you get the point.

Whenever the European crisis hits and however it is manifested, the US will be affected. It could affect us in a small way or a big way. That is impossible to predict at this point. It is also not possible to predict when it will hit, as doing so involves the collective… Read More

In the second “episode” of our saga on fixing our problems and bringing America a new period of growth and optimism, I will address an issue that none of you will be surprised to see me tackle – the debt and deficit. Since I was first elected to the California State Assembly in 2000, trying to get government to tax, spend and waste less has been a major priority for me. As such, you have heard a lot from me on this issue. So, I will not repeat much of what I have said incessantly for years so that I don’t become electronic Ambien for you.

Instead, let me put this problem/opportunity in the context of the larger issue we are talking about. Implementing a plan to gradually fix our deficits and reduce our debt is a necessary but not sufficient condition for growth. Fixing the deficit will not in and of itself free the economy for sustained prosperity. There are other things we have to do that I will write about in future episodes. Suffice it to say, fixing the deficit is not a sufficient condition. But, it is a necessary one. If we don’t do it, we will certainly bring on a crisis which will plunge us into a long and… Read More