Written By: Erik Stryder
Editor: Nigel Woodford
President Obama's Economic Stimulus Package, AKA The American Recovery and Reinvestment Act of 2009, is vague and ambiguous. It essentially gives the federal government and its bureaucracies carte blanche to spend 787 billion tax-payer dollars as it sees fit. The latitude is broad, the restrictions few. The people are being asked again to trust the judgment of the many custodians of taxpayer money.
The American Recovery and Reinvestment Act of 2009, as it stands, is in excess of 1,000 pages long. We are curious to know whether or not our senators and congressmen have actually read this document. We know from their own public admissions that many of them did not read the PATRIOT Act before they signed it. Is this another case of delegation of responsibility, or has the diligence required by such an equally important document been performed?
We have reviewed the available text of the final version of this bill. We fail to understand how lowering taxes and increasing spending will save the American economy. Spending more money while reducing income does not work at our houses! How will this plan benefit our country? Would it not be wiser to indulge in more fundamental solutions? It is our belief that a more simple approach is warranted.
We have not seen evidence of success with the bank bailout. As funds were distributed, we began to hear of parties being thrown because “we have to show our staff that we appreciate their hard work”. Is that not what paychecks and bonuses accomplish? At the same time the banks were accepting government money, we heard bank executives complain about restrictions on the dispersal of these funds, saying that the government should not interfere in their business affairs. They wanted the money, but did not wish to be held accountable. This has not inspired great faith in the integrity of the recipients of the bailout.
Suppose we attempt to restore value to mortgage-backed securities by empowering bankruptcy court judges to restructure home mortgages? . If consumers are able to make their loan payments, will this not keep them in their homes? Will this not restore some faith in the banking industry? Will this not help to stabilize Wall Street? President Obama has good ideas in this area, but as we expected, the House has managed to foul the plan with their usual level of competence. How is rewarding the reckless greed and stupidity of banks and brokerage houses more valid?
How is providing the banks the motivation to begin extending more credit to consumers going to stimulate the economy? Is not the reckless extension of credit one of the many factors that has brought us to the brink of destruction? It seems to us that encouraging consumers to be more responsible should be a major theme. Living within our means, rather than indulging in our need for instant gratification, might be the order of the day. This idea may not increase the GDP in a big way, but a smaller increase in productivity may be wiser than sliding further into credit-induced debt.
Tax-credits and tax rebates will not stimulate the economy when it has begun to tank. The people will take that money and use it to eliminate existing debts in an effort to stave off eminent financial destruction. They will not use the money to buy new goods and services. This sort of theory is put forth by legislators who do not know the current price of a gallon of milk. America's working people are acutely aware of the price of everything.
Suppose we impose stiff restrictions and penalties on American companies that outsource manufacturing, customer-relations, and service jobs to other countries? Will this not reduce unemployment by restoring jobs to the workers of America? How is it more constructive to reward these companies with tax breaks while they take jobs away from Americans?
Suppose we do something about the price-gouging practices of big oil? The increase in the price of a barrel of oil has not been proportional to the increase at the pump. The high price of gasoline and diesel has raised the prices of shipping, food, and goods across the entire market. Somehow, big oil has managed to post record profits while the rest of the economy has come crashing down.
Suppose we restore the regulation of big business that was removed during the Reagan administration? Deregulation may appear to be a good idea on the surface, and we will grant that it may be a good idea to limit the power of government to interfere with business to an extent, but let us keep in mind why regulation of big business is necessary. Regulation, like the labor union, is necessary because big business can not be trusted to be anything other than greedy and self-indulgent. It has demonstrated these traits consistently since the dawn of industrialization. Regardless of political affiliation, we can not deny these facts.
Many of the ideas being discussed on the Hill sound suspiciously like the ideas put forth by the previous administration, but communicated in a much more articulate manner than previously stated by the cheerleader with the two digit I.Q.
Is it not wiser to correct the behaviors that caused the economic disaster we now face, or shall we throw money at the problem while continuing the practices that brought us here?
These are but a few of the solutions that might be investigated before 787 billion American tax dollars are misspent.
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