Storm Clouds Are on the Horizon

by Dr. Gary Welton

Storm Clouds Are on the Horizon
Storm Clouds Are on the Horizon
The Center For Vision & Values
The Center For Vision & Values

Grove City, PA -( In predictable economic times, it makes sense—indeed it is essential—to put money aside and save for the coming rainy day.

Trouble is brewing for each and every one of us. For some, it is just two appliances failing in the same month. For others, it is the unexpected loss of employment due to a company buyout or a changing marketplace. For some, it will be a cancer diagnosis with many expenditures, no matter how strong your insurance plan. Have you prepared for your rainy day?

In ancient Egypt, following Joseph’s dream interpretation, Pharaoh prepared for the future by establishing a safety net through storing grain that would keep people alive during the seven-year famine. We do not have inspired dreams today to help us identify coming threats, but the wise family (and the wise nation) prepares for the certainty of future storms, even without knowing the nature of those storms.

In unpredictable economic times, and in socialistic systems, saving for the rainy day makes less sense. If the entire economy is expected to go belly up, then it is logical to enjoy and consume today, for tomorrow our resources will be worthless. Enjoy an extravagant lifestyle, because your assets might be worthless next year. I’m making no dire predictions, but I have more than $19 trillion reasons to be pessimistic.

Likewise, in a growing socialistic system, there is little incentive to save. For example, the more money I save for my children’s education, the less unmet need they will have, and hence the less need-based scholarship money they will receive. There are more systemic incentives to spend than there are personal incentives to save.

In Kathryn Forbes’ classic story, “Mama’s Bank Account,” mother calmed her family by referencing their slush fund. If they were to run out of money, they always had a Plan B. We later learn, however, that their Plan B was actually a myth; there was no bank account. In today’s society, we not only have no savings, we have also lost our assurance from mama’s claims. There is no longer any sense that the future is secure. Indeed, recent statistics ( tell us that 41 percent of Americans in my age bracket (55 to 64) have no retirement assets. About 22 percent of employees currently have outstanding balances in which they owe themselves money to their retirement accounts. We save very little and then borrow that little that we have saved.

The infrastructure of America is in serious shape. Roads and bridges are deteriorating. Water and energy delivery systems are in danger. But, instead of investing in tomorrow, our governments are shortsightedly mortgaging that future. Some have argued that massive debt is not a problem, but indeed our current growing debt is not sustainable. My recent working trip to Puerto Rico revealed the serious limits imposed by massive debt levels. The commonwealth cannot invest in capital improvements because of their regular defaulting on debt payments. Although their per capita debt is considerably higher that our federal debt, our continuing borrowing rates will soon put us into similar dangers. Our multi-trillion dollar debt and our continued huge annual borrowing is not sustainable.

Granted, our economy is relatively strong, when compared to most economies around the world. However, we are falling behind in our national infrastructure. The current system of massive debts for short-term consumption is not sustainable. We have no bank account from which to draw.

I encourage individuals to save for their rainy day, because troubles do always come. I encourage our local, state, and federal leaders to do the same. We, as baby boomers, have failed to invest in the coming generations. Instead of strengthening our infrastructure, we have mortgaged our future.

This is not progress, and it is not sustainable.

Dr. Gary L. Welton
Dr. Gary L. Welton

About the Author:

Dr. Gary L. Welton is assistant dean for institutional assessment, professor of psychology at Grove City College, and a contributor to The Center for Vision & Values. He is a recipient of a major research grant from the Templeton Foundation to investigate positive youth development.

  • 2 thoughts on “Storm Clouds Are on the Horizon

    1. I am so glad to come across articles like this written by smarter people than, however just reinforces what I ALREADY thought. I did start saving early (thanks to my dad’s umm… frugile nature) however I have a son whom I raised by myself and now that he is out of the house, I try to save every penny for his future to be somewhat secure. And when I say “save every penny” that also means investing in lead,brass and chrome lined barrels. Including AR 500 clothing if you get the reference.

    2. Doc – great article! All true, and very sad indeed. At the individual level I’d encourage everyone to save and invest for their future. Some percentage of that should be in tangible assets since the dollar may well be losing it’s place as the global ‘reserve currency’. Every year about this time I look at the Monthly Treasury Statements and around page 13 you will find Total Interest Paid by the Treasury Dept. We are on track to spend around $450 Billion USD to service the national debt of $19.5 Trillion and the ‘Trust Funds’ of Social Security and Medicare that we’ve ‘borrowed’ against. The entire Department of Defense Budget is $600 Billion. Yes – we are spending 75% of the entire DoD budget just to service our national debt at a historically low 10-year bond rate of 1.5%. When interest rates head back to 6% – you’ll have a spread that will put the interest payment well over $1 Trillion dollars. To paraphrase a lot of folks that are smarter than I am – “This won’t end well.”
      Cover your own bases and look out for your own family.

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