A few years ago, my daughter asked me some detailed questions regarding the Vietnam War. Let’s just say I wasn’t as knowledgeable or detailed as she would have liked. So much so, I had to defend myself with something along these lines: “I was too old for it to be in my history books, but too young to remember what actually happened.”
Perhaps as a result, I greatly enjoyed the recent documentary on PBS by Ken Burns and Lynn Novick, entitled simply “The Vietnam War.” To be sure, the 18-hour, 10-part series didn’t cover every aspect of the war, and I am more than certain there are a fair number of detractors. There always are with such things. Regardless, I found it to be a meaningful effort, as well as a cautionary tale.
In the financial services industry, we have to say things like: “Past performance is not indicative of future results.” While this is absolutely true and the right thing to say, I have found the past is often the best predictor of the future. As the old saying goes: “Those that don’t learn from history are doomed to repeat it.” After all, if the sun rose in the East this morning, the odds are it will do so again tomorrow.
That word “odds” is key here. That is all we are really doing in life: playing the odds.
So, let me ask you these questions:
Will U.S. private enterprise grow or shrink in any given year?
Will the stock market go up or down that same year?
What if you had to bet $100 on each? While no one can look into the future with crystal clarity, wouldn’t you bet they will both grow or go up? With this in mind, let me ask you a couple more:
Will Washington spend our money wisely and efficiently?
Will politicians promise too much and deliver too little?
How would you bet your $100 on these questions? What would you say the odds are here? While past performance is not indicative of future results, what would history suggest? Have we learned anything from it?
We live in a civilized society, or presumably so, and there is a real need for government and governmental services. I will make no bones about it: The private sector probably would not provide all that we currently enjoy, if that is the right word, from the government. You can actually scratch the probably.
Even so, assume the end goal is to increase overall societal wealth and economic activity, understanding absolute tax receipts tend to go up when those things happen. Again, you have to bet your $100, and you have to choose one or the other. It is all or nothing. So, do you bet it on the private enterprise system to grow the U.S. economy? Or do you put your money down on the federal government?
What would the odds suggest?
The problem is we want the federal government to be so much more than what it is and what it can reasonably provide. While past performance is not indicative of future results, it does suggest we should be very careful about giving Washington too much authority, too much of our money and too much of our trust.
In a lot of ways, all those years ago, you could argue the war in Vietnam helped to set some of today’s odds.
(Read More as previously published in the Montgomery Advertiser on October 16th, 2017)