Wednesday, January 16, 2008

Do we need an economic stimulus package?

Many of the Presidential candidates are proposing a short term economic stimulus package to try to keep our economy out of a recession.

If we go into a recession in the short term it will be due to the following things:

1. The high price of gasoline.
2. The fact that real estate prices are dropping and there is a "glut" of homes on the market.
3. The subprime mortgage problems and the number of mortgage defaults.
4. The reality that our trade and tax policy have forced our jobs overseas.
And many more reasons.

The main reason we are headed for a recession is the fact that Americans have overspent at have all levels of our Government. There is too much debt and it is not all going to be paid back.

A short term stimulus package would infuse money into our economy and this would tend to help prevent us from slipping into a recession; however, when we do slip into a recession it would make the recession worse...

We do NOT need a short term stimulus package. What we need to do is to:

1. Simplify our tax code and change it so it helps keep jobs here.
2. Change our trade policy.
3. Encourage Americans to save rather then to spend.

A recession is coming and it is going to be a big one. There is just too much debt in our economy and our politicians keep trying to "spend our way out of it."

Mike Sylvester

8 comments:

Andrew Kaduk said...

Mike, you forgot something kinda important.

The first item on your list SHOULD be for the Government to get itself out of a deficit spending mode first.

How can we lowly peasants be expected to save when the people who literally manufacture currency are setting such a fine example?

Robert Enders said...

Elected officials are under a great deal of pressure to act like they are doing something to fix the economy, even when advisors say to just ride it out. This is what I imagine the next president will do during the next recession:

1. Tour a factory while wearing a hardhat.
2. Use the recession as a pretext to push foward the agenda that s/he wanted to promote anyway.

Andrew Kaduk said...

I think you're on solid ground with those two predictions, Robert.

Bobby G. said...

Andy gets it...Bob Gets it...and Mike gets it.
(psst...I get it too))
We have consensus, gentlemen.

Still, as long as we have all these "reality" shows to watch, who will honestly care about any recession??
"Give me American Idol...or give me something else"

Welcome to the United States of Entertainment!

;)

B.G.

Fr. Fozy Bear said...

The only way you are going to pull the country out of the recession is by letting it happen and then redevalue our currency; in other words, we can either buy back our currency and mark its value to a precious metal or change it and then have a buyback program (oh wait that plan is already in the works- The Amero) and with either plan it would only take seven to thirteen months to turn the recession around.

The other idea would to actually charge people the correct amount for goods and services. For instance the other day I was cross shopping between three different groceries for some County Line Colby Jack Cheese and Kroger/Scott's wanted 5.49/lbs. Meijer and Wal*Mart had it on sale for 4.49/lbs. The PIO Market on State Blvd. just east of Crescent had it at its usual price of 3.49/lbs, a dollar fifty difference from the name brand "discounted" retail groceries!
So much for counting on Kroger or Everyday low prices of Meijer!

This is yet one more reason why we need more mom and pop retail groceries. I miss Tapp's Meat Market.

Robert Enders said...

Fozy, the dollar IS the "Amero". It's accepted everywhere from the Yukon to the Yucatan. They'll even take it in Cuba.

Fr. Fozy Bear said...

Ah but it is no longer accepted at the Taj Mahal (sp?) and since it is so deficient (at last report .75 to the 1.00), which is why gas cost so much right now, which is also why OPEC was pandering to get OIL values detached from the US Dollar on the commodities and exchanges.

Robert Enders said...

A combined North American currency would have the same problems the dollar is having now. The problem with the dollar is with the US government's spending practices.