Fareed Zakaria on CNN’s GPS Sunday:(emphasis added)

“In 1979 Paul Volker was appointed Chairman of the Federal Reserve and he began to raise interest rates to crush inflation. It succeeded. And it had a follow-on affect around the world ushering in an era of low inflation, low interest rates and strong growth. What impresses me most about Volker was his willingness to do something that was deeply unpopular at the time in the short term for the long term good of the country. What he did then is now widely praised, but at the time he was burned in effigy as a job destroyer.

If you think about just about every problem we face in the United States, and in fact in Europe, Japan and every advanced industrial country, the solutions are readily identifiable. But they all involve trimming benefits, restricting credit, raising retirement age, trimming pensions and of course raising taxes. The effect of these reforms would be to place the country on much stronger economic foundation, but that benefit comes slowly over time while the costs are sharply felt now and by powerful special interests.

That’s why no one will propose any serious cuts in spending or any serious increases in taxation. Much easier to give everyone what they want and solve the problem by borrowing, borrowing, and more borrowing. So the core problem facing rich democracies these days is they can’t impose any short-term pain for long-term gain. And if we can’t find the the courage to do it, it is very difficult to be optimistic about the future for these countries, including the United States.