California Budget Crisis
Recently the governor of the Great State of California, where I reside, said that unless something is done soon California will run out of funds within two months. Aside from making more budget cuts it appears that the main option that our state government has is to raise taxes and to do this soon. Both of these options do not seem to be the best options, especially during this time of deep economic national recession. Yet, regardless of the options and the negative impact that I believe they will have on our state, something has to be done or the state will have no funds.
How did we get into this situation? It is simple: Our state government spends too much. Our state government wants to help and invest in as many people as it can, so it funds as many programs as it can. This is something that state governments should be doing. However, there is a principle that seems to be overlooked. If you spend more than what you have you are going to get into a financial mess. This is true for governments, businesses, non-profit organizations and individuall finances. Spending beyond the budget eventually leads to a financial crisis.
Our nation has been living this way for quite some time. Our federal government spends way beyond what it brings in, a practice that has left us with a deficit of over ten trillion dollars. Ten trillion dollars! I have trouble wrapping my mind around that number. Most Americans also live beyond their means. I read recently that the average American household has a credit card debt of around nine thousand dollars. Living beyond our means is catching up with all of us. It is my humble opinion that the financial woes that have hit our great nation have been, to a large extent, the result of overspending.
The Book of Proverbs gives us some sound advice about living within our means. Proverbs 27:23-27 says the following:
23 Know the state of your flocks,
and put your heart into caring for your herds,
24 for riches don’t last forever,
and the crown might not be passed to the next generation.
25 After the hay is harvested and the new crop appears
and the mountain grasses are gathered in,
26 your sheep will provide wool for clothing,
and your goats will provide the price of a field.
27 And you will have enough goats’ milk for yourself,
your family, and your servant girls.
Although today most Americans have nothing to do with raising livestock the principles found in this passage are fully applicable to the twenty first century. Verse 23 begins by saying, “Know the state of your flocks, and put your heart into caring for your herds…” To know the state of one’s flocks means to know how many one has, how their health is and how fast they are reproducing. This is important if flocks and herds are one’s means of supporting one’s family. This means that if you are counting on living off of 500 sheep you should take the time to make sure that you will have 500 sheep to count on throughout the year. It also means that if you have 500 sheep you shouldn’t live a lifestyle as though you own 800 sheep because spending as though you had 800 sheep when you only have 500 will soon place you in an economic mess. Today most Americans are able to live beyond their means because of credit cards thinking that their income will hopefully increase and that the economy will always be strong. Verse 24 warns against this way of thinking. It says, “for riches don’t last forever, and the crown might not be passed to the next generation.” Economies change and new governments or administrations may not be as wise as previous ones have been. When one’s job is lost or there is a change in the economy it becomes very difficult, if not impossible to keep up with all of the debt. This is why if you have 500 sheep to count on for the year don’t spend as if you have 800.
The second part of verse 24 says, “and put your heart into caring for your herds…” I believe that for us today this means that we must take care of our jobs, the companies we work for, our businesses and our employees. It also means to manage well the money we earn, as well as our investments knowing that if and when change takes place in the economy or in our employment we will be ready. Verses 24-27 are so important: 25 “After the hay is harvested and the new crop appears and the mountain grasses are gathered in, 26 your sheep will provide wool for clothing, and your goats will provide the price of a field. 27 And you will have enough goats’ milk for yourself,
your family, and your servant girls.” We are told here that by taking care of the flocks and herds they will provide for the basic necessities, such as goat’s milk and wool for clothing, for us and our families. Food and clothing here represent the staples of life and not the wants and gotta-have’s. This speaks of finding contentment in meeting our families basic needs. We begin to overspend when we get caught up in having things. I am not saying that having nice things is wrong. I do not think that it is wrong. But purchasing things that we can’t afford and do not really need gets us further into debt and places us more at risk of getting into a financial crisis.
The second part of verse 26 speaks of investing for the future. It says, “and your goats will provide the price of a field.” If you are in the flock and herd business you will eventually need to buy more land if you plan on growing your number of flocks and herds. This requires that you invest in new fields to be able one day to sustain more livestock. Most Americans spend what they do not have now to pay it back latter with high interest. Instead of investing now for their future they spend today what they do not yet have. No wonder that there are so many Americans that cannot retire at age 65, or even at age 70 for that matter. They never learned to invest for the future.
If the government of the State of California would only learn to operate within ita budget we would not be in this economic mess. I fear that once taxes are raised on us californians our state government will only spend more. They are spending today what they do not have, and are taking from our future and the future of our children.