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Perot Offers Tough Prescription for U.S. Debt Dependency

“At one time U.S. Treasuries were considered the safest investment you could make. Now you’ve got every reason in the world to be concerned.”

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WealthCycles Commentary

“We’re on the edge of the cliff,” said former U.S. presidential candidate Ross Perot in 2012, “and we have got to start fixing it now. Otherwise we’re leaving a disaster to our children’s and grandchildren’s future, and we could even lose our country.”

In a rare interview with USA Today reporter Richard Wolf shortly before the 2012 elections, Perot comments on the state of the U.S. economy, in particular U.S. debt and deficit—a discussion, Perot points out, that the presidential candidates had thus far avoided.

Billionaire industrialist Henry Ross Perot himself ran for the presidency as a third-party candidate in 1992, against Democrat Bill Clinton and incumbent Republican George H.W. Bush. Perot’s campaign gained surprising momentum—given the U.S.’s entrenched two-party political system—with a populist message with Libertarian overtones, tough on the budget deficit, and illustrated with charts and graphs that became signature campaign props. Perot ultimately received 18.9% of the popular vote, making him the most successful third-party candidate since Theodore Roosevelt in 1912.

Fast-forward a decade, and Perot notes, “Nobody that’s running (in 2012) really talks about it, about what we have to do, and why we have to do it. They would prefer not to have it discussed.”

But, asks interviewer Wolf, Europe tried austerity as a way out of recession, and that hadn’t worked out so well. Perot responds:

“If I told you, ‘I don’t want to dig out of my debt problem until I go broke,’ you’d say, ‘What are you talking about, Perot?” And that’s what you just said, but in very polished terms, recession.
“No, you know, you’re not going to pay your debt if you don’t have the money. And if things are going downhill and you’re running debt up, you’re making it naturally impossible to pay your debt, and we’ve got to put the brakes on  now and do this now…. It can be done if we in the House and Senate and White House have the will. And certainly they should have the full support of the American people…”

Wolf asks how close the U.S. is to crisis. Could it get so bad that investors would no longer buy U.S. debt? “Of course,” Perot answers.

“Common sense tells you—we’re not talking about politicians now; we’re talking about people taking money out of their pocket—at one time that was considered the safest investment you could make, was in a Treasury bill or something, right? And now you’ve got every reason in the world to be concerned…. Is that going to last? How long will it last?”
But Wolf asks, to be fair, haven’t the circumstances of the country in recent years—9-11, the recession, the war on terrorism—prevented leaders from making the national debt and deficit a priority?
“It shouldn’t have, if people were thinking clearly, if they were well educated, if they even understood this whole thing, which they don’t… A very low number of the American people understand…. It should be everybody…. This is my country. … People should be very active about not letting anything damage our country.
“The one thing we have not mentioned at all, there is no question at all in my mind, if we keep going this way, some nation is going to head over here to take us. And, boy, if they do, they’ve picked the right time. I wish every American would think about that all day, every day, and say, we can’t let that happen. We had the greatest country in the world; we’ve got to get it back there, and keep it there and make it better every year, not worse every year. That should be our goal. Every year we should look back and say, ‘Boy, things have gotten really a lot better…. Not just settle for what you have, and not let it fly apart.”

Perot in 2012 couldn’t get over the fact that none of the candidates in that year’s presidential race would talk about the threat posed by the U.S. debt. Now, halfway through the presidential term, nothing has changed.