Reggie

Stop Trying to Jump-Start the Consumer - Barron's Interview

Not enough is said about the role of state and local governments. They are generally in debt and spend more than they take in. Yes, I know many state constitutions say they must have a balanced budget. But we all know there are ways of getting around that--float some bonds, for example.

Point is: Consumers can save and improve their balance sheets but if cities, states, and the federal government don't move in this direction, there is a lot of pain to come.

While consumers soon see the sense of saving and cutting debt, politicians have no incentive to do this.

I'm trying to find a logical way out of this but until the voter forces the politician to change, it won't happen. And, frankly, the voter doesn't have a lot of clout in this battle.

I hope one of you can show me where I am wrong.