Stupid Choices Equal Bankruptcy (Usually)

In 1977, newly married and certain that my new spouse could do no wrong, I willingly followed him into an adventure of Tennessee farming.  I was a city girl, but my new husband said we were going to raise sheep, cattle, and horses, make tons of money, and live happily ever after.  Because of the politics of the day, the Farmers Home Administration had taken on several newly developed loan projects and low-income families like us were given a rosy scenario of cheap money for cheap land.  Inflation had not yet begun to raise its ugly head and the future seemed bright.  We bought 375 beautiful Tennessee acres, brand, spanking-new farming equipment (nothing runs like a Deere), 600 head of Texas ewes, and a number of registered Quarter Horses, and were donated a small herd of cows by my father-in-law.  The grand total of the FmHA loan, at a whopping 4% interest, was around $257,000, including $197,000 for the farm.  This unemployed cowboy wannabe and this McDonald's breakfast-crew worker thought the government was generous to a fault.

We began our incredible journey with the delivery of the 600 sheep, some of which were dead on the truck.  We should have refused them then, but we were young and stupid and surmised that it was normal to have a few animals die in transit.  Little did we know that they were heavily infested with stomach worms that ended up killing a total of 200 of those ewes the first year, with the subsequent loss of the wool and all of those money-making lambs.  We were in trouble financially from the very start, but never mind, we would regroup, recoup, and everything would be just fine.  

Life was one exciting story after another and it was of no concern that we were barely making interest-only payments on our loan.  The government was so very understanding and wanted us to succeed.  My husband got a new loan for feed and more sheep and more horses, used part of the money to travel to sheep and horse shows, to buy diamond earrings -- after all, a farmer's wife had to look nice! -- and a custom-made saddle to perch atop our finest piece of equine flesh.  We bought a brand new 4-door GMC Dual Wheel pickup truck with matching trailer so that we could participate in horse shows in style.  Horse people were a bit snobby and we wanted to be sure to look the part.  We figured that winning competitions would bring in prize money and buyers for our horses.  Unfortunately, we weren't winning many competitions.  All the while, we were opening our home to anyone who wanted to "hang out" at the farm and we provided meals, housekeeping, and laundry service to some who stayed for weeks on end.

By the third year, the government agency was getting a little testy with our lack of payment but we assured our agent that we knew what we were doing and would be hitting paydirt soon.  We were issued a new loan to purchase a fancy Barbados ram that we figured would breed triplets and quadruplets into what ewes we had left.  The ewes were our money-making staple and we knew we had better make them produce even more.  As happens with many "best laid plans," ours went awry.  The ram was mean as a snake and dangerous to handle and wasn't a very good producer.  The best we got from the ewes was twins, not enough to sell and make a yearly payment on our ever-growing debt.  We took out another loan to pay for that year's feed and I began feeling uneasy about our situation.  My angst turned to fear and anger when I discovered, having not been let in on the secret, that some of our horses were being sold at auction along with the custom-made saddle that I had personally chosen.  I was angry because I saw no reason to have to sell anything.  These were our things and we needed them to make the farm work!  My lack of understanding of the situation sent me packing, in tears, and home to Mama.

Close to Christmas, I returned to the farm, begging for forgiveness.  And a lavish Christmas it was.  Gifts were showered on everyone, paid for with money we did not have.  Denial had become our way of coping.  The year 1981 rolled in shortly thereafter along with a letter from the Farmers Home Administration informing us that our loan was delinquent and payment would be due forthwith.  The real world had finally wormed its way into our consciousness, and had evidently prodded the government's as well.  We decided to assess exactly where we were financially.  The gruesome reality was that we were $350,000 in debt, with interest mounting exponentially.  Our only income was my $175-per-week job and around $20,000 in lamb and wool sales, the best those sheep could do in spite of our efforts to demand more.  To mix clichés, the party was over and the piper wanted payment.  We had hit the debt ceiling and we were going to default. 

A real estate agent was quickly employed.  By this time, high inflation had kicked in, the Butcher brothers were in full swindle swing, and Ronald Reagan was trying to put air into the failing economy.  The Butchers actually looked at our farm as a potential investment and one of their cronies purchased it right before their whole empire came crashing down.  Ironic, eh?  As a result of high inflation, we were able to sell the farm for $367,000 which would have been a nearly 86% return on our investment.  But instead of seeing any money, we paid off our loans except the $100,000 that had been loaned to us by parents.  Though the real estate agent graciously accepted what was left, even though it shorted him his full commission, I was angry at him and the "mean people who made us sell the farm."  It was not until years later that I understood the meaning of personal responsibility.  We got out by the skin of our teeth and lost all that we had accumulated, but we did not declare bankruptcy.

So why do I tell all of this?  It is because, as I watch the charade in Washington, D.C. regarding the debt ceiling, I feel like I am back on that farm, desperately trying to hang onto a lost cause, blaming everyone but myself and my spouse for the disaster.  There are so many analogies in my story that it is sobering.  Over the years, this government has purchased millions of acres of land, as well as thousands of buildings, with the ensuing cost of upkeep and regulation.  Our government has been spending money with reckless abandon on wars and policing operations all over the world to make us look rich and powerful.  We have welcomed anyone into the country who wishes to come legally or illegally, providing meals, medical, housing, and work.  For years we've had lavish "Christmases" of entitlement spending to millions of Americans backed by invisible money that the country doesn't have.  We've gifted countries all over the world with promises of billions of dollars in aid.  And when reality has tried to wave a hand for warning, the politicians have simply turned their heads in denial and demanded more from the highest producing "sheep" through higher taxes.  When the tax revenues don't pan out, the politicians get fierce with more regulation.  The "sheep" either quit producing or run away to greener pastures -- other countries.  While we foolishly tried to stimulate income by more spending, the US president and Congress have tried to stimulate the country's economy with their own poorly devised spending plans.  Yep.  The analogies are endless. 

The time has come for the American government to take personal responsibility for its own mess.  There can be no getting mad at the Chinese because they expect payment on loans they fairly issued.  There can be no finger-pointing at businesses which see no point in enabling poor managers of the country to spend any further.  There can be no gnashing of teeth at those who recognize the quandary and who seek to cut spending and sell off assets -- and the government will have to sell assets.  The party is over and the piper has to be paid.  The American people are going to have to suck it in for some tough times ahead.  Some "sheep" may have to find their own grass and others may have to find their own shelter.  The managers of the farm have misused their power and cannot be the providers anymore.  Default and bankruptcy can be avoided, but not with more debt and not with continuing denial and definitely not with more spending.  Just as was true in our case, the country is at a point where it must make the hard choices -- face the facts or face ultimate bankruptcy.  I pray that our representatives in Washington, as well as all American citizens, will face the facts before it is too late.

In 1977, newly married and certain that my new spouse could do no wrong, I willingly followed him into an adventure of Tennessee farming.  I was a city girl, but my new husband said we were going to raise sheep, cattle, and horses, make tons of money, and live happily ever after.  Because of the politics of the day, the Farmers Home Administration had taken on several newly developed loan projects and low-income families like us were given a rosy scenario of cheap money for cheap land.  Inflation had not yet begun to raise its ugly head and the future seemed bright.  We bought 375 beautiful Tennessee acres, brand, spanking-new farming equipment (nothing runs like a Deere), 600 head of Texas ewes, and a number of registered Quarter Horses, and were donated a small herd of cows by my father-in-law.  The grand total of the FmHA loan, at a whopping 4% interest, was around $257,000, including $197,000 for the farm.  This unemployed cowboy wannabe and this McDonald's breakfast-crew worker thought the government was generous to a fault.

We began our incredible journey with the delivery of the 600 sheep, some of which were dead on the truck.  We should have refused them then, but we were young and stupid and surmised that it was normal to have a few animals die in transit.  Little did we know that they were heavily infested with stomach worms that ended up killing a total of 200 of those ewes the first year, with the subsequent loss of the wool and all of those money-making lambs.  We were in trouble financially from the very start, but never mind, we would regroup, recoup, and everything would be just fine.  

Life was one exciting story after another and it was of no concern that we were barely making interest-only payments on our loan.  The government was so very understanding and wanted us to succeed.  My husband got a new loan for feed and more sheep and more horses, used part of the money to travel to sheep and horse shows, to buy diamond earrings -- after all, a farmer's wife had to look nice! -- and a custom-made saddle to perch atop our finest piece of equine flesh.  We bought a brand new 4-door GMC Dual Wheel pickup truck with matching trailer so that we could participate in horse shows in style.  Horse people were a bit snobby and we wanted to be sure to look the part.  We figured that winning competitions would bring in prize money and buyers for our horses.  Unfortunately, we weren't winning many competitions.  All the while, we were opening our home to anyone who wanted to "hang out" at the farm and we provided meals, housekeeping, and laundry service to some who stayed for weeks on end.

By the third year, the government agency was getting a little testy with our lack of payment but we assured our agent that we knew what we were doing and would be hitting paydirt soon.  We were issued a new loan to purchase a fancy Barbados ram that we figured would breed triplets and quadruplets into what ewes we had left.  The ewes were our money-making staple and we knew we had better make them produce even more.  As happens with many "best laid plans," ours went awry.  The ram was mean as a snake and dangerous to handle and wasn't a very good producer.  The best we got from the ewes was twins, not enough to sell and make a yearly payment on our ever-growing debt.  We took out another loan to pay for that year's feed and I began feeling uneasy about our situation.  My angst turned to fear and anger when I discovered, having not been let in on the secret, that some of our horses were being sold at auction along with the custom-made saddle that I had personally chosen.  I was angry because I saw no reason to have to sell anything.  These were our things and we needed them to make the farm work!  My lack of understanding of the situation sent me packing, in tears, and home to Mama.

Close to Christmas, I returned to the farm, begging for forgiveness.  And a lavish Christmas it was.  Gifts were showered on everyone, paid for with money we did not have.  Denial had become our way of coping.  The year 1981 rolled in shortly thereafter along with a letter from the Farmers Home Administration informing us that our loan was delinquent and payment would be due forthwith.  The real world had finally wormed its way into our consciousness, and had evidently prodded the government's as well.  We decided to assess exactly where we were financially.  The gruesome reality was that we were $350,000 in debt, with interest mounting exponentially.  Our only income was my $175-per-week job and around $20,000 in lamb and wool sales, the best those sheep could do in spite of our efforts to demand more.  To mix clichés, the party was over and the piper wanted payment.  We had hit the debt ceiling and we were going to default. 

A real estate agent was quickly employed.  By this time, high inflation had kicked in, the Butcher brothers were in full swindle swing, and Ronald Reagan was trying to put air into the failing economy.  The Butchers actually looked at our farm as a potential investment and one of their cronies purchased it right before their whole empire came crashing down.  Ironic, eh?  As a result of high inflation, we were able to sell the farm for $367,000 which would have been a nearly 86% return on our investment.  But instead of seeing any money, we paid off our loans except the $100,000 that had been loaned to us by parents.  Though the real estate agent graciously accepted what was left, even though it shorted him his full commission, I was angry at him and the "mean people who made us sell the farm."  It was not until years later that I understood the meaning of personal responsibility.  We got out by the skin of our teeth and lost all that we had accumulated, but we did not declare bankruptcy.

So why do I tell all of this?  It is because, as I watch the charade in Washington, D.C. regarding the debt ceiling, I feel like I am back on that farm, desperately trying to hang onto a lost cause, blaming everyone but myself and my spouse for the disaster.  There are so many analogies in my story that it is sobering.  Over the years, this government has purchased millions of acres of land, as well as thousands of buildings, with the ensuing cost of upkeep and regulation.  Our government has been spending money with reckless abandon on wars and policing operations all over the world to make us look rich and powerful.  We have welcomed anyone into the country who wishes to come legally or illegally, providing meals, medical, housing, and work.  For years we've had lavish "Christmases" of entitlement spending to millions of Americans backed by invisible money that the country doesn't have.  We've gifted countries all over the world with promises of billions of dollars in aid.  And when reality has tried to wave a hand for warning, the politicians have simply turned their heads in denial and demanded more from the highest producing "sheep" through higher taxes.  When the tax revenues don't pan out, the politicians get fierce with more regulation.  The "sheep" either quit producing or run away to greener pastures -- other countries.  While we foolishly tried to stimulate income by more spending, the US president and Congress have tried to stimulate the country's economy with their own poorly devised spending plans.  Yep.  The analogies are endless. 

The time has come for the American government to take personal responsibility for its own mess.  There can be no getting mad at the Chinese because they expect payment on loans they fairly issued.  There can be no finger-pointing at businesses which see no point in enabling poor managers of the country to spend any further.  There can be no gnashing of teeth at those who recognize the quandary and who seek to cut spending and sell off assets -- and the government will have to sell assets.  The party is over and the piper has to be paid.  The American people are going to have to suck it in for some tough times ahead.  Some "sheep" may have to find their own grass and others may have to find their own shelter.  The managers of the farm have misused their power and cannot be the providers anymore.  Default and bankruptcy can be avoided, but not with more debt and not with continuing denial and definitely not with more spending.  Just as was true in our case, the country is at a point where it must make the hard choices -- face the facts or face ultimate bankruptcy.  I pray that our representatives in Washington, as well as all American citizens, will face the facts before it is too late.