Confused About This Economy Stuff
From what I've gathered, there's a big divide on whether a "stimulus package" will actually help the economy. As you might expect, I have some thoughts, although I admit that I do not totally understand the boundaries of the issue.
First, it seems like Obama started a while back in recruiting notable economic minds to hatch this plan. I know he met with folks, but I have no way of verifying how much input any of them actually had.
Second, it makes more sense to me to invest in our own country than a country half way around the world which doesn't seem to want our help any longer.
Third, I'm hearing that there's obvious opposition from Republicans, but also dissent from Democrats. I've heard at least one Republican state that he'd rather see tax cuts than a stimulus plan, which makes sense to me, but also seems like the same basic thing. The bottom line in either case is whether the money people/business receive or don't have to spend is put away for safe keeping, or spent. Everyone agrees that more long-term purchasing is what the economy needs, right?
Fourth, why is a stimulus package "socialist" but taxes are not?
Fifth, I don't understand how putting hundreds of billions of dollars into the economy will fix anything in the first place. Sure, there's spending, but that money could be gone in a year. Then, everyone has a new TV, but our 401Ks are still depleted.
Sixth, could it be that baby boomers are retiring and there's less and less fluid cash in the markets? Could they be conservative, and upon hearing about tough times, start stuffing their mattresses? Could one generation of Americans be tipping the scales for the entire world economy?
What's your take?
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3 comments:
"could it be that baby boomers are retiring and there's less and less fluid cash in the markets? Could they be conservative, and upon hearing about tough times, start stuffing their mattresses? Could one generation of Americans be tipping the scales for the entire world economy?" - This is the first I've heard of this theory. Very interesting idea, I'll have to stew on this some more. Very interesting post.
Here's my ultra-simplistic take. When I have money, I like to go out. Maybe see a band, definitely have a drink or six, and in general, spend my excess cash. I'll even spend money on my friends so they can hang with me or have a few drinks.
When I'm in debt, I tend to stay home more because I need that extra cash to pay off my credit cards, or whatever the case may be. It would be irresponsible for me to be giving all of my money to the Empty Bottle when I should be paying off my debts.
Maybe the US should take the unusual step of just worrying about ourselves for a change. I'm not an isolationist, and again, this obviously is a simplistic take, but maybe it's time for our country to stop going out to our favorite hotspots (Iraq, Iran, Afghanistan), to stop spending our money on our friends (like Israel), and to huddle down and worry about our own bottom line first and foremost. That's what I would do.
E - I couldn't agree more. The $800 billion bailout package is a drop in the bucket compared to the cost of the war. I think the days of war being good for the economy are over - maybe because we're no longer a manufacturing center and the wars are bullshit.
Your point is a prudent, long-term fix, but what about the current state? We've already blown our money for the month at the bar, the credit cards are maxed out, and all the bills are due. The way I understand it (and I hope I'm not ruining your metaphor), the argument is whether we take a risky loan to pay off the bills (bailout) or file bankruptcy and reduce what we owe (lower taxes). I think there's a party divide on the issue and I'm not sure I don't lean conservatively on this since the bank bailout already proved to be such a fiasco.
I'm also wondering why a plan can't be drafted that gives us the best of both sides? Why not reduce the bailout amount, follow through on the promise of transparency (so I know where my tax money is being spent), and reduce taxes all at once?
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