Stimulous Part Two

To Simulate or Not to Stimulate....that is the Question

It just aggravates me to no end when either party has control and feel it's okay to bully the other. This doesn't work because it just causes the other party to dig in their heels and make life miserable. It doesn't work in business, it doesn't work on the playground, and when it's our Federal government the American people end up the losers. Take the latest stimulus package, the democrats added in a bunch of pork to show how great it is to be the big shots on campus, and it caused the republicans to dig in their heels and whine to anyone that would listen.

It's not that the republicans whining is not without merit, but they also seem to forgot that when they were control the democrats and the American people were forced to eat their pork. It also needs to be said I don't care much for pork especially fatty pork and both sides have their history of fatty pork padding. John McCain said he hated republican pork as much as democratic pork, but he voted the republican pork filled bills.

Yesterday and Today

No, I'm not talking about Y&T, but literally lets leave yesterday to historians, and worry about today and tomorrow. The bill the democrats support is full of pork, some fatty, and some lean but pork has no business being in this particular stimulus package. I have to wonder what would the Republicans had said if the bill had been pork free. However we'll never know because the Democrats screwed up a big chance to show the American people that they truly care about these difficult times. Now it appears the Republicans are the caring ones but the truth is they really don't care. I don't think either side does since they have no worries about being laid off.

They need to start acting like neither side has a majority and think about what is best for the American people. Historically speaking when the congress is more narrowly controlled by one side or the other, they are forced to work together more. When one side has a overwhelming majority they become drunk with power and pass whatever they like. If the president happens to be on the other side, then he will become an insignificant president, but if the president happens to be on leading side, then he has big problems.

I think this president is in trouble because the higher they are, the further they will fall.

The Politics of Being Political

I can't be a democrat or republican, because I have to watch both sides closely and listen to what they are both saying. Some of the infrastructure spending is a good thing but I don't think it's enough nor do I think it will solve all our economic problems. Lowering taxes on businesses will help the businesses but I really don't see them expanding much as a result of this. When times are hard people hold onto their pennies more, and it's true for everyone. I don't think a business is going to look at their lower taxes and say let's expand. They are still going to be uncertain that their business will even be around in a few months with or without lower taxes.

It's all a gamble, with the Republicans wanting to fix everything by just cutting taxes alone and the Democrats wanting to spend their way out. Tax cuts for businesses and wealthy people sounds great on the surface but it doesn't wash with the middle and lower middle class people, since with them lies most of the spending power. We already know that alone doesn't work, it hasn't worked for the past 8 years. If a business large or small gets a few paltry tax cuts, but people still don't feel comfortable enough to buy their goods, their business will fail. If the government puts lot of money into infrastructure, which would create jobs, but if people still don't feel comfortable they still won't spend money and businesses will still fail.

I think what bothers me the most is the Republicans are just standing back, saying it won't work and seriously hoping things will just fall apart.

What They Aren't Saying..

I was watching Bill O'Reilly's show after the President spoke and he was talking with Dick Morris, who explained that the Japanese in the 1990's tried to spend their way out of their big recession...both of them and subsequent guests just threw up their hands and said it didn't work. The problem is they didn't mention that the Japanese also cut 2 trillion in taxes too...and it didn't help them in addition to their big spending. What the Japanese did have going for them was the fact they saved their money roughly 13% of their income goes into savings. Roughly 1% of the average American's income goes into savings.

The problem is I don't think either has it right...you can't cut taxes to get out of a recession (at least it's never worked in the past) and you can't spend your way out of it. The only thing you can do is curb your spending, save as much money as possible, and hang on because I think the only cure for a recession truly is time. When goods and services get too expensive too fast recessions are useful. When the stock market starts to nose dive they call it a price correction--over-inflated stocks come down in price more in line with their true value. When houses dropped they called it bubble and the effect is the same, prices came down to where they probably should have been had the boom not occurred. Now the whole economy is going through the same thing. It's going to take a long time but I believe things will get better--it will just take time and probably more time than the next couple presidents will have. And yes you did read that right. We're talking 8-10 years people!

I believe if Obama's stimulus goes through as planned, we will benefit from it but I'll be very surprised if it's within the next four years. If the next president doesn't try to undo everything, then perhaps during that term things will start to turn and they can take credit for it. If they do try to undo everything, then we'll sink deeper but still eventually things will improve. The question is would things improve without all this on it's own in the same amount of time.

That too, I believe is possible, but try to convince Washington of that.

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