IOUs are not a solution to this issue as they are just another way to avoid the difficult choices that must be made. Plus, IOUs are nothing more than a form of debt which is in violation of the will of the people that voted to end this practice going forward. How is it that state officials do not seem to understand that the voters want the spending reduced, no more searching for ways to keep financing unsustainable budgets with taxes or debt which should include the use of IOUs? It makes you wonder if these IOU issuances may prove to be a ploy in which the state never honors, they can be conveniently extended into the future to be dealt with at another time by someone else. This will make the state Government either disingenuous with the voters or dishonest with the recipients of the IOUs. There is really only one way out of this crises and it is to bring the expenditures in line with the revenue of the state. No amount of political deception, avoidance, or any other attempt of bypassing this reality is going work. Simply, IOUs are a form of debt in which voters clearly rejected, they should not be used and expenditures should be reduced instead.

This is something we should all watch carefully throughout the country because it is going to be the fate of our nation as well. Our Federal Government is travelling down the exact same road of irresponsibility as the state of California did, and our future will soon be bringing us a dreadful message as well. They say as California goes, so goes the country. The only difference is California can not print its own money and the day may come that we are going to wish the same of our Federal Government as well.

The focus of raising the needed funds will surely be centered on borrowing from foreign sources until their lending appetite is exhausted, and then the difference will be covered with printing. It makes you question whether it is better to borrow or print since the foolish decision has apparently been made to spend what we do not have. Borrowing money right now can be done at very favorable rates, but it will have to be paid by taxpayers in later years to include future generations that had no responsibility in the decisions creating it. It is difficult to view this generational theft as anything but morally wrong. On the other hand, inflation created by excessive printing of money is suffered by the very citizens that are currently responsible for this Government’s decisions via the voting booth. By directly affecting the pockets of the current voting public it creates the potential to force some discipline back into the system as the suffering proliferates. Many of the programs that are leading to this unprecedented governmental spending can be reversed with pressure from the current voters, and it is their responsibility to do such or suffer its consequences. Inflation is an evil tax on purchasing power that is effectively a tax on everybody through higher prices of the goods and services in our economy. From a taxpayer point of view this might be the lesser evil versus debt because everyone is sharing the burden of higher prices instead of only taxpayers suffering the burden with repayment of governmental borrowing. That is unless we magically find a way to produce our way out of the deficits, but let’s not hold our breath for that to happen. The burden of excessive spending must fall on either those responsible for it or to a future generation that will have to produce and tax their way out of it. To borrow or to print is a false choice being presented, the right answer is neither, but I think America has proven its inability to take that path.