EDITORIAL: A penny saved …

OPINION:

COMMENTARY:

As the financial crisis that apparently started here at home winds its way around the globe, the order of the day for ordinary

taxpayers is hiding in plain sight. Politicians and economists call it fiscal discipline. Our Founding Fathers called it personal responsibilty.

The days of thrift seem long gone, as Americans now seem to prefer debt-financing as a way of life. Credit-card debt has tripled since 1990, with the average American owing approximately $9,000 on their credit cards, according to USA Today and bankrate.com. Since 2000, Americans have saved just 2 percent of their income compared with 8 percent in the 1980s. According to CardWeb.com, approximately 43 percent of American families spend more than they earn each year and personal bankruptcies have doubled in the past decade. Many Americans have over-leveraged their homes to the point of choking on payments and for some, ending in foreclosure.

Who now adheres to Benjamin Franklin’s dictate that “a penny saved is a penny earned”? The common wisdom - as typified by the 19th-century best-seller penned by Samuel Smiles, “Self- Help,” - that thrift was a virtue and debt was shameful. This notion is reinforced by biblical passages that champion personal responsibility. For example: “Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much. So, if you have not been trustworthy in handling worldly wealth, who will trust you with true riches? And if you have not been trustworthy with someone else’s property, who will give you property of your own?”(Luke 16:10-12)

For centuries, capitalism has been buoyed by a Christian ethic that champions hard work, self-reliance and thrift - values that have been, well, devalued in recent years. In fact, spending beyond one’s means and acquiring debt have been encouraged by financial advisers as a savvy means to make more money. In that view, debt can be used to finance investments, which can ultimately lead to more wealth.

How was a vice turned into a virtue - and a virtue turned into a vice?

The ethic of thrift has lost its currency, in part, due to get-rich-quick proprietors, which portray saving money as useless. For example, Robert Kiyosaki, author of sensational best-seller, “Rich Dad, Poor Dad,” says that the traditional approach of working and saving leads to stagnation rather than wealth. Prophets of wealth accumulation also say that paying down one’s mortgage as quickly as possible is foolish, for a house that is paid off is “dead equity” or “a liability.”

Ordinary Americans are reaping the fruits of such advice.

In light of this economic mess, it is worth considering a return to once-cherished monetary values that made the American economy the envy of the world: Work hard, save money and live within one’s means. America’s way toward economic recovery is a long road. But it does not have to be painstaking as well.