I.O.U.S.A.: One Nation. Under Stress. In Debt.
By Addison Wiggin and Kate Incontrera
288 pages, $19.95
“I. O. U. S. A.” is most famously a 2008 cautionary movie á la Al Gore’s “An Inconvenient Truth.” As with “Truth,” I. O. U. S. A. has broadened its scope to become a multi-media crusade. The title will route you to Web sites providing, among other things, an up-to-the-moment tally of the U.S. national debt, which now exceeds ten trillion dollars. You’re not alone if you can’t wrap your brain around such a mind-boggling figure, but all formats of I. O. U. S. A. mitigate the problem via the same populist, relatively easily-digestible presentation.
Addison Wiggin and Kate Incontrera have produced the latest incarnation: a book they concede is a rather difficult exercise in “reverse-engineering.” They pull it off in admirable fashion. The meat of their story is the four national deficits outlined in the film. The budget deficit tracks the history of our shortfall, which has become parabolic in recent history. As a point of reference, the second President Bush had a mere $5 trillion deficit to contend with at the start of his first term.
The savings deficit means that Americans are spending more than they earn. It was only within the last generation or two that people began fantasizing that one could live on credit.
The trade deficit came upon us in similar near-instantaneous fashion. Before 1987, we were the largest creditor nation in the world. Suddenly we find ourselves with the biggest international I.O.U. in history.
This all becomes a perfect storm as the baby boomers are poised for retirement with all the attendant financial and social implications. For all practical purposes, our society is bankrupt.
The fourth problem, the leadership deficit, is perhaps the least concrete. We live in an age of sound bites. Anyone attempting to tell a complex truth about deferred gratification, responsibility and sacrifice likely will become unelectable. This is not to absolve the politicians of their share of the guilt—they certainly pander to our baser instincts. Most economists blame the second Bush for excessively cutting taxes at the same time government spending was running rampant.
We’ve been living beyond our means in a way reminiscent of ancient Rome just before the fall. We’ve been shuttling our bill to future generations. The second half of the book features in-depth interviews with prominent financial experts including Alan Greenspan and Warren Buffet. They dissect the problems and offer solutions. It’s a fascinating read.
As with “An Inconvenient Truth,” the movie version of “I. O. U. S. A.” opened just as the crisis seemed imminent. The book version hit just as it was starting to become actualized. Let’s hope any future book of Gore’s won’t result in a similar trajectory.
Art Collins is the author of “Beating the Financial Futures Market: Combining Small Biases Into Powerful Money Making Strategies.” E-mail Art at email@example.com.