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Palin's National Debt Mischaracterization vs. American Indebtedness

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Leave it to "Mama Grizzly Bear" Sarah Palin, not only the outspoken former governor of Alaska and VP candidate, but a multi-millionaire too from exploiting right-wing sensibilities.

Now on a national tour touting her new Christmas book, Good Tidings and Great Joy, she took an opportunity last week to decry the destructive effects of our burgeoning national debt, which stands at more $17 trillion (or $54,134.23 per person) on America's future generations.

She told Iowans at a Faith and Freedom Coalition fundraiser that the obligations that come with a high national debt financed in part by countries like China is analogous to enslaving young Americans.

"Our free stuff today is being paid for by taking money from our children and borrowing from China," she said, according to the Des Moines Register.

"When that money comes due -- and this isn't racist -- but it'll be like slavery when that note is due."

Her words "electrified" the crowd of 750 and set off recriminations against her and her metaphor, which probably helped sell lots of her books too.

Even though she prefaced her use of "slavery," the mere use of the word can result in ridiculous condemnation, such as the denunciation by the likes of Al Sharpton.

At first, I found her words yet just another example of how the far right continuously shoots itself in the foot.

With President Obama's domestic agenda in disarray because of the debacle of the Obamacare website and his lying about keeping health insurance policies, you'd think that even the most acerbic "conservative" talking heads would have the sense to sit back and silently watch the damage unfold.

But nooooo.

For Palin, Beck, Limbaugh, Hannity, Levin, Newsmax and others, it's all about titillating the Tea Party and Christian conservative base (and exploiting them with their books, survivalist gimmicks and even gold-buying sites).

It's also about staying relevant when common-sense guys like Chris Christie, who some polls are now showing can beat Hillary Clinton in 2016, are stealing the show.

Then, after I got the first student loan bills my son accrued during his recent tenure at NYU and realizing his upcoming "enslavement" for decades to paying this debt, I began to think that Palin may have had a point.

From the start of the Obama era, the emphasis of his administration should not have been on health care but on reducing and restructuring our government spending to eliminate waste and slow the borrowing.

Now, instead of implementing the reforms proposed by the bipartisan National Commission on Fiscal Responsibility and Reform and talking about restoring Glass-Steagall regulations, we are fixated on balky web pages.

That emphasis on government spending also needed to be complemented by a new era of regulation of financial institutions. Regulators need to focus on institutions "too big to fail," eliminate predatory lending and reform how debt scores are calculated. They need to examine how Americans are lent money, whether it be credit-card lending, student loans, mortgages, or car loans.

According to nerdwallet.com, the average U.S. household consumer debt profile included: credit card, $15,112; mortgage, $146,215; student loan, $31,240. In total, American consumers owed $11.08 trillion, $846.9 billion in credit card debt, $7.75 trillion in mortgages and $1,002 billion in student loans (an increase of 10.9 percent from last year).

There's no way to attain the American dream anymore for young and old alike unless the overall debt problem in America, not just the national debt, is brought under control. In economic terms, this debt is truly enslaving our children, particularly when the 20- to 24-year-olds have an unemployment rate of 12.5 percent.

So Sarah had it right and wrong.

Our debt is enslaving. But the real enslavement is not from Chinese investors buying US Treasuries, but from a failed economic system lacking smart regulation that allows predatory borrowing that enriches Wall Street instead of Main Street.

This article appeared in Florida Context on November 14, 2013