I’ll never forget the first time I met “Captain No”.
I was a young, 17-year old new cadet at West Point about to take my first Physical Fitness test– a semiannual requirement in the military that involved a bunch of push-ups, sit-ups, and running.
The physical fitness test was proctored… meaning that a veteran Army officer would literally stand there and watch me do push-ups. And if I didn’t do them properly, i.e. go all the way up, all the way down, the repetition wouldn’t count.
By sheer misfortune, the Army officer proctoring my first exam was a stern, mean-looking captain. He was built like a featherweight boxer but had enough pent-up anger to punch like Mike Tyson. I suppose I would too if I had to watch teenagers do push-ups for a living.
Little did I know that this Army officer was legendary at West Point for his fanatical, absolutist approach to physical fitness tests. And the cadets had given him a special nickname: Captain No. I soon found out why.
When it was my turn, I walked over to the exercise area and greeted him. He brusquely told me to get into position, and then he blew the whistle. My two minutes of push-ups had started.
The first 10 or 15 repetitions were a breeze, and I remember thinking, “this guy is no big deal”. Then came the first “No!” from the captain. Apparently I hadn’t gone down all the way. Or all the way up. Who knows.
But I didn’t let it faze me and went down for another push-up. “No,” he announced again, with similar disregard as a police officer who has demanded to see your license and registration.
I couldn’t figure out what I was doing wrong– push-ups aren’t exactly a complicated maneuver. But the more I cranked out, the more he kept rejecting them. “No. No. No. No,” he went on, like a monotonous broken record.
I barely passed my exam that day. And, fortunately for me, I never ran into Captain No ever again during my time at the academy. But he became one of those people that, you only have a brief encounter with, but remember for the rest of your life.
Sometimes I randomly think about him and wonder what he’s doing.
And, to be honest, lately I’ve been wishing that he would suddenly turn up and announce his candidacy for President. Because I believe that America desperately needs Captain No.
I watched last week’s Presidential debates– mostly out of curiosity.
And, while I came to the conclusion that there are a handful of candidates who understand the problems, it’s also obvious that hardly anyone (including the moderators, or the public in general) actually understands the limits of Presidential authority.
This is pretty common. Every four years, candidates invariably make promises to voters about what they’re going to do. Most of the time they stick to high-sounding platitudes like “invest in jobs” or “get the economy going” or “stand up to China”.
Of course, these slogan mean absolutely nothing because they’re accompanied by no detail whatsoever.
Occasionally, however, political candidates make specific promises… like banning assault weapons, banning abortion, raising taxes, cutting taxes, etc. Sometimes candidates will even promise to do these things “on Day 1 of office”.
The reality is that most of these promises go far beyond the legal authority of the President. With VERY limited exception, the President cannot change tax rates, ban anything, or even so much as spend much money without Congressional approval.
The one key power he has– especially when it comes to the economy– is to veto Congressional spending bills. And that’s why “Captain No” is so desperately needed.
Excessive federal spending is quickly becoming the most critical issue affecting the US economy. There’s has simply been too much of it for far too long.
Nearly four years ago, just after the close of Fiscal Year 2019, I wrote a concerned letter about the state of government finances.
FY19, I wrote, was “literally, the BEST year EVER measured by short-term US financial performance.”
In 2019, the stock market had reached an all-time high. Real estate had reached record highs. Corporate profits were at record highs. Unemployment was near an all-time low.
Things couldn’t get better for the US economy. And as a result, federal tax revenue also reached an all-time high; the US government was swimming in cash like Scrooge McDuck.
Not to mention, there were no major emergencies in 2019. No recession. No war. Everything was perfect.
Yet even with all that perfection, the federal government STILL managed to increase the national debt by more than $1 trillion that fiscal year.
And I wrote on October 1, 2019,
What’s going to happen when the economic sun isn’t shining so brightly?
It would be foolish to expect every year to look like Fiscal Year 2019. Honestly, the combination of so much good news and so little bad news in FY19 was pretty rare.
There absolutely WILL be problems in the future. Recessions, panics, downturns, bear markets, natural disasters, trade wars, military conflicts, debt crises, pension crises, etc.
Well, we found out the following year. Disaster struck. And by the close of FY20 (on October 1, 2020), just one year after I wrote those words, the national debt had increased from $22.6 trillion.. to $27 trillion. In a single year.
Today the national debt is almost $33 trillion, up $2 trillion from the start of the current fiscal year that started last October. And yet, like in 2019, this year there was no national emergency. No pandemic. No existential crisis where they had to spend “whatever it takes”.
And yet, even under fairly normalized conditions, the people in charge have still managed to overspend by $2 trillion this fiscal year.
This level of reckless spending is cancerous for the US economy.
For starters, reckless federal spending is a major driver of inflation, which hurts just about everyone.
Reckless government spending also means that there’s less private capital available to invest in the economy… something known as the “Crowding Out Effect”.
In other words, whenever the government spends too much, it means they have to borrow more money. This is why the national debt increases.
But the amount of savings in the economy is not infinite… especially now that the Federal Reserve is reducing the money supply.
So as the government borrows more money, there will be less money left over to invest in businesses. This hurts US productivity… which actually makes the problem worse.
Lower productivity means the economy will grow more slowly (or not at all). And slower growth means lower tax revenue… which means the government will have to borrow even more money.
You can see how nasty the cycle can become.
It’s also worth noting that continued deficits also risk the US dollar’s status as the dominant global reserve currency… which would be yet another catastrophe.
The Land of the Free is quickly reaching a bifurcation point where excessive spending and outrageous deficits could create a terrible economic spiral that is very difficult to escape.
If the US wants to avoid complete disaster, the deficits have to stop, and the government has to learn to live within its means.
This takes me back to the President’s authority.
The only real power the next President will have is to veto any budget or legislation that exceeds tax revenue.
And this is why America needs “Captain No”.
I would have loved to see the guy on stage at the debate last Wednesday and say, “I will literally reject every Congressional action that increases the national debt by a single penny. And if you think I’m bluffing, just try me. I’m Captain No, dammit.”
What’s the worst that could happen if excessive Congressional budgets are vetoed? Another government shutdown? Hallelujah.
Do you remember the last shutdown a few years ago? I doubt any of us woke up in a cold sweat fretting that the Department of Commerce was closed.
The ‘essential’ workers (like the military) still came to work… leading me to wonder why the government even has ‘non-essential’ workers to begin with.
This situation is fixable. There is still a VERY LIMITED window for the US government to get spending under control, re-establish the primacy of the dollar, and increase economic productivity.
It might take “Captain No” to get it done. But in case the guy doesn’t show up, it certainly makes sense to put together your Plan B… before you need it to become your Plan A.