Time To Look Up the Meaning of the Word ‘Economics’

By J.F. McKenna


Words have meanings.


Take the word “economics.” The word’s origin is Greek. “Oikonomikós” refers to household management. (Impress your friends: Tell them that the Greek word “oikos” means house.)


Right now, such states as Wisconsin and Ohio stare at their respective broken budgets. For them, the meaning behind “economics” is starkly clear.


State-managed “household budgets” are busted.


That means states have to trim spending. That also means a lot of businesses will observe how these states confront the challenge of shrinking public funds. (Again, impress your friends: Businesses typically establish and expand operations in states that manage budgets without resorting to tax increases.)


Now consider the word “trim.” The verb means “to adjust to a desired position.” For Governors John Kasich and Scott Walker, that means taking the appropriate remedies to keep Ohio and Wisconsin, respectively, in a position to pay current bills, meet future obligations and make their states attractive to new and prospective businesses.


These public CEOs confront tough choices, particularly the trimming of privileges enjoyed by public-employee unions. As financial columnist Larry Kudlow explains, “state and local government unions have a 45 percent total-compensation advantage over their private-sector counterpart. With high-pay compensation and virtually no benefits co-pay, the politically arrogant unions are bankrupting America — which by some estimates is suffering from $3 trillion in unfunded liabilities.”


Unfunded liabilities spell disaster. And you might as well punctuate the preceding sentence with further unemployment and fewer opportunities to keep and attract businesses.

So when critics of Kasich, Walker and others like them condemn state plans to trim spending, ask those naysayers just one question.

“Do you really understand the meaning of the word ‘economics’?”

J.F. McKenna is a business journalist and communications consultant.



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