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Yash Gupta
Business School Dean

Yash Gupta

Yash Gupta is Professor and Dean of The Johns Hopkins Carey Business School.

Something-for-nothing culture

In response to the On Leadership question: Can Americans handle the painful truth about government budget deficits -- that getting them under control will require both tax increases and cuts in government services -- or will they reject any leader who dares to deliver it? What's a leader to do?

One of the most important jobs of a president is to show the nation how to get to the future. But before that can happen, we have to rectify the terrible mistakes of the recent past. To start shrinking this $1.6 trillion federal deficit, President Obama will have to dish out some harsh medicine - possibly including tax increases and program reductions - and he can make it all palatable if he explains in a coherent and detailed fashion the tough economic choices that the American people face, and why we have to make them. For example, if we don't lower the deficit, then we'll have inflation, and inflation will mean more unemployment, higher prices, an economy still stuck in the mud. Put it in concrete terms that hit home with the average citizen.

Some people say the American public will tolerate only so much pain and suffering. After all, we seem to have evolved into a something-for-nothing, consumerist culture dedicated to all kinds of fabulous new gadgets and creature comforts. No statistic expresses that better than the total U.S. credit card debt of $874 billion - about $10,000 per American household, according to the Financial Times. Our household savings rate is 5 percent, which actually is an increase over previous years, but it still pales alongside the roughly 30 percent rate you see in China and India. Those two nations are among our main global competitors, but how are we going to keep up when we're drowning in so much red ink, and especially when China owns about $800 billion in U.S. Treasuries?

Americans have a proud history of sacrifice in times of hardship. I believe we can do it again if President Obama can inspire us to do so. Yes, we can handle the truth, but we need our president and other national leaders to tell us what's at stake, in terms that are clear-eyed and precise, yet humble and hopeful.

By Yash Gupta

 |  February 2, 2010; 2:13 PM ET
Category:  Political leadership Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati  
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