Earlier this week, Obama kinda, sorta, gave us his wants and desires from Congress for a quick turn around on MORE MONEY. Come on folks say it with me ('cause Lord knows we all know it by heart at this point) "It's not too late to change course – but only if we take immediate and dramatic action." Ooooo, gloom and doom. Yeah……..been there, done that. Sadly, his radio address/YouTube video gives us no real insight. While it is clear that his words are full of promises and fear mongering, there are few details. We don't know where he is going to get all the money he's asking for. Immediately. Before catastrophe sets in. What about the jobs he is creating; no, saving; wait no, creating? No creating or saving, that's it. Throughout the speech there is really nothing more than window dressing, no actual road map. But, Obama would like Congress to get to work on passing this behemoth monster so it can be on his desk on day 1 of his term. It seems our recipe for "hope and change" is more of the same with over-bloated government instituting a very bad plan; an example of failed policy, known as Keynesian economics.
By several estimations, the numbers Obama laid out will result in 600,000 new government employees. That's fun. Do you think we will get through the DVM lines any faster? Or will we just make up positions for them. Maybe Road Hole Filler Czar. Maybe Lay Around and Do Nothing but Get Paid Czar. Or, maybe Obama will just start imposing all kinds of crazy rules, regulations and hoops for businesses large and small to jump through. Then those people can work in offices taking care of the resulting paper work nightmare. The rest of the jobs are going to come from the private sector. Hmm, I wonder how that will be accomplished. Will we as business owners be required to have a certain amount of employees or be penalized? It is a mystery why the private sector will suddenly have need for millions more employees, but that is just trivial fact-not hope and change.
Another huge complaint with the stimulus-what is the roadmap back from the brink of hell? With this thinking we are adding almost 1 trillion dollars to our existing deficit. There is no way to ever tax us out of this kind of debt. Taxes would have to be so high and people so oppressed there would likely be some kind of revolt. A plan of deficit spending, without desire for consumer spending, will only have a snowball effect from this point forward. 1 trillion this year, 3 trillion next year and on and on until our nation just collapses on itself. The few who actually make millions are not enough to take care of the rest of us. Period. Obama never lays out how we would get out if this mess. Only how we get in it. Well sorry-that isn't good enough for me!
Finally, in an interview with Charlie Rose two economists (Feldstein and Stiglitz) seem to agree with the very salient point-you canNOT force consumer demand!!!! A huge influencing factor in the economy right now lies in the fact that people are not buying. Spending all this money and creating (or saving-whatever) all those jobs will only float us for a year or two. Then what? People are in a saving cycle-not a spending cycle-we all got burned on that deal. It is very likely we will get two years into this thing and it will be just like the $350 billion that congress (or better yet Paulson) wasted away. It will have not worked, we will be that much poorer and we will have a several trillion dollar deficit.
Everyone in Washington must get a handle on ridiculous spending. The government already spends tons of money all the time! If spending was going to work we would not be in this mess. What congress must do is actually enact policies that will help every American. Payroll taxes should be lowered or eliminated. Investments definitely should be made in our infrastructure-but only on those projects that are worth it and can be afforded. Families who are losing their homes, but are actually trying and capable of getting out of their housing mess should be assisted. The American family needs a break. We are debt weary and spending shy. After some time passes we will have some money saved, begin to feel better about things and once again spend money. While I know Obama would disagree with me "Government is NOT the answer."