Wednesday, December 16, 2009
The Wrong Priorities
It just came out the House passed a $174,000,000,000.00 jobs creation package. This comes at the heels of the already $800,000,000,000.00 stimulus package passed earlier this year with the same goal. With so much money being spent by as large a bureaucracy as the US federal government, it's difficult to tell how and when the money will be spent. The aim of this newest stimulus effort is public works and infrastructure, but the questions raised are will this work and can we afford it? We all know our government is in severe debt right now with lost jobs each month and GDP growing at a snail's pace. It's also clear that with an overhaul of the health care system around the corner, increased troop levels in Afghanistan, and a proposed cap and trade bill, we are banking our financial future on the foresight of our elected officials that have now have dipped low enough to count "jobs saved" as an accurate measure of success. If we can't quickly and efficiently spend stimulus dollars from the first stimulus package what makes anyone believe we will this time? What's clear is that the Democrats in Washington don't see fiscal responsibility and responsible use of federal power as the highest priority, but rather that themselves will be seen as the catalyst of recovery and they'll do so at literally any cost. The failures of our financial system and the Bush administration are behind us and the lessons learned should be used to further the goal of economic expansion and prosperity in the United States. Instead this administration is spending money with the kind of recklessness you'd think we've learned from. Economists have many tools at their theoretical disposal and deficit spending is one of them, but this has been taken to a level never seen before in our country. We need strong leadership and somehow confidence in our system needs to be addressed, not simply government spending for the sake of government spending. We are allocating dollars like it's monopoly money and if this pattern continues, that's exactly what the dollar will be.
Wednesday, December 9, 2009
The Case Against The Obama Tariff
As the global recession continues to plague the United States, President Obama has taken steps both large and small in an attempt to both stimulate the economy and create jobs. The largest piece of legislation aimed at stimulating the economy was an almost eight hundred billion dollar stimulus package geared towards infrastructure improvements and job creation. One of many smaller supplements to this stimulus is a tariff on Chinese made passenger and small truck tires. A tariff of 35% will be imposed during the 2010 year, followed by 30% and 25% in 2011 and 2012 respectively. This move is in response to perceived dumping of Chinese goods on the U.S. market by Chinese manufacturers. (Wiseman) This is a relatively small move as it relates to the global marketplace and even within the tire industry, however it could have larger implications of where this administration views its role and authority in regulating Chinese-U.S. trade relations. The Obama administration is pleasing a small segment of the U.S. workforce while potentially compromising a fruitful trading partner, most likely our largest trading partner of the future. I will make the case that the short term gains domestically from this policy do not outweigh the long term ramifications as a whole, and therefore is not justified.
As word of the planned tariff on Chinese made passenger and small truck tires spread to leadership of China, the following statement came from Beijing, “China strongly opposes this serious act of trade protectionism by the U.S. This act not only violates the rules of the World Trade Organization but also violates the relevant commitments made by U.S. government at the G-20 financial summit.” It comes as no surprise that China is opposed to such an action. A domestic market for China in which total capacity will rise 16% in the next year and is currently four times greater than domestic demand,(Wiseman) a significant tariff such as the one currently being employed will greatly hamper continued job growth and increasing market share of the U.S. tire market. Retaliatory protectionist measures are sure to follow from China, and when it comes to trade, China has the upper hand. Currently we have a large trade deficit with China, for the 2009 year it already over 165 billion dollars. However, free trade with China will improve the standard of living for both countries in the long term. As China continues to grow and specialize, the U.S. will specialize in goods which it has a comparative advantage, and jobs will grow for both nations.
A study done in the 1990’s compared the dollar amount U.S. consumers spent as a result of imposed tariffs. It compared that data with the number of jobs saved as a result of the tariff, and how much each of those jobs paid. According to the study U.S. consumers were estimated to have paid $1,285,000 annually for each job preserved in the luggage industry due to barriers to trade. For each textile worker saved, $199,000 was spent. For softwood lumber jobs, $1,044,000, and $1,376,000 for each job in the benzenoid chemical industry. (Blinder) All of these numbers are significantly higher than the dollar amount paid per year to each of those workers paid respectively. One should also consider the fact that for each of these industries workers will still be laid off as a result of lowered domestic and foreign demand due to the current global recession. According to the Mackinac Center for Public Policy, a tariff imposed by President Bush in 2000 on imported steel goods reduced national income by between .5 to 1.4 billion dollars. (Lafaive) While surely not perfect studies, this demonstrates empirically that there is significant evidence to suggest that trade protectionist ideas might sound good to the domestic producer, but the consumers are the ones that pay, as well as foreign relations. From 2004 to 2008, 5,168 jobs were lost in the U.S. tire industry, surely not all from foreign Chinese competition. Statements made by the U.S. domestic tire industry suggest that in this particular market the low quality, and therefore low price passenger and small truck tires is an area already realized to have a foreign advantage and domestic supply has shifted towards higher quality and higher price tires that China can’t as easily compete with. The U.S. tire industry was not the group that requested this tariff, but rather the United Steelworkers union. The administration was pushed around by a special interest group under the guise that a great many jobs would be lost if no action was taken.
Many economics have argued that in the long run free trade will create more jobs and wealth than protectionism and that if the public can understand this economics concept, they will be more likely to be supportive of more free trade policy. An example of this idea was put forth by Alan Blinder, “Some lawyers are better typers than their secretaries. Should a lawyer fire his secretary and do his own typing? Not likely. Though the lawyer may be better than the secretary at both typing and arguing cases, he will fare better by concentrating his energies on the practice of law and leaving the typing to his secretary.” (Blinder) In this particular case, the U.S. has an advantage in terms of capital and technology, while China has the advantage in labor. This clearly explains the emergence of more and more low quality low price goods being imported from China. Instead of artificially inflating the price of low quality tires by domestic suppliers, the government should be promoting free trade and competition which should increase the supply of higher quality tires using more capital, technology, and research and development than the Chinese and could actually create more jobs. It is easy to fear the perceived ability of the Chinese to produce all goods at a lower price than domestic suppliers, but it was Ricardo that put forth the idea of comparative advantage and in this case, the U.S. surely has one in high tech products. According to Adam Smith, “It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy...If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage.” (Blinder)
It seems it is the nature of the local population to see protectionism as in the best interest of their own country because as people lose jobs and domestic industries shrink, it is clearly attributable when a foreign supplier is entering the market aggressively. They wouldn’t as easily attribute the low prices they enjoy, and also the expansion of other related domestic industries to foreign competition. Adam Smith stated, “To expect, indeed, that the freedom of trade ever should entirely be restored in Great Britain, is as absurd as to expect then an Oceana or Utopia should ever be established in it. Not only are the prejudices of the public, but which is much more unconquerable, the private interests of many individuals, irresistibly oppose it. (Smith). The people clearly see a lost job as a terrible thing, as they should, but they are also somewhat blinded to the big picture. It is much easier to point to an empty factory and blame foreign competition, than it is to see another factory still open and know its existence is due to free trade.
The Obama administration is doing its best to restore the economy of the U.S. as well as the world, and also to restore the image of the United States. This latest act of protectionism might have been decided on with the best intentions for the U.S. worker, and very well might save jobs here at home. However, the long term existence of the U.S. as a global financial leader depends on free trade and its trade partners. Alienating China for perceived dumping of low quality products that the U.S. already has lessening interest in pursuing in the market place will only hamper efforts of economic coordination and a global financial relief effort. It can’t be proven how many jobs will be created, it can’t be proven how much the consumer will pay, but has been shown in history that the burden of the load will be on the U.S. consumer, and a full return of the global economy relies on the United States consumer having the income and desire to purchase goods from the global marketplace. Restricting the ability to find low price products if one desires, is a short term fix to a long term problem.
As word of the planned tariff on Chinese made passenger and small truck tires spread to leadership of China, the following statement came from Beijing, “China strongly opposes this serious act of trade protectionism by the U.S. This act not only violates the rules of the World Trade Organization but also violates the relevant commitments made by U.S. government at the G-20 financial summit.” It comes as no surprise that China is opposed to such an action. A domestic market for China in which total capacity will rise 16% in the next year and is currently four times greater than domestic demand,(Wiseman) a significant tariff such as the one currently being employed will greatly hamper continued job growth and increasing market share of the U.S. tire market. Retaliatory protectionist measures are sure to follow from China, and when it comes to trade, China has the upper hand. Currently we have a large trade deficit with China, for the 2009 year it already over 165 billion dollars. However, free trade with China will improve the standard of living for both countries in the long term. As China continues to grow and specialize, the U.S. will specialize in goods which it has a comparative advantage, and jobs will grow for both nations.
A study done in the 1990’s compared the dollar amount U.S. consumers spent as a result of imposed tariffs. It compared that data with the number of jobs saved as a result of the tariff, and how much each of those jobs paid. According to the study U.S. consumers were estimated to have paid $1,285,000 annually for each job preserved in the luggage industry due to barriers to trade. For each textile worker saved, $199,000 was spent. For softwood lumber jobs, $1,044,000, and $1,376,000 for each job in the benzenoid chemical industry. (Blinder) All of these numbers are significantly higher than the dollar amount paid per year to each of those workers paid respectively. One should also consider the fact that for each of these industries workers will still be laid off as a result of lowered domestic and foreign demand due to the current global recession. According to the Mackinac Center for Public Policy, a tariff imposed by President Bush in 2000 on imported steel goods reduced national income by between .5 to 1.4 billion dollars. (Lafaive) While surely not perfect studies, this demonstrates empirically that there is significant evidence to suggest that trade protectionist ideas might sound good to the domestic producer, but the consumers are the ones that pay, as well as foreign relations. From 2004 to 2008, 5,168 jobs were lost in the U.S. tire industry, surely not all from foreign Chinese competition. Statements made by the U.S. domestic tire industry suggest that in this particular market the low quality, and therefore low price passenger and small truck tires is an area already realized to have a foreign advantage and domestic supply has shifted towards higher quality and higher price tires that China can’t as easily compete with. The U.S. tire industry was not the group that requested this tariff, but rather the United Steelworkers union. The administration was pushed around by a special interest group under the guise that a great many jobs would be lost if no action was taken.
Many economics have argued that in the long run free trade will create more jobs and wealth than protectionism and that if the public can understand this economics concept, they will be more likely to be supportive of more free trade policy. An example of this idea was put forth by Alan Blinder, “Some lawyers are better typers than their secretaries. Should a lawyer fire his secretary and do his own typing? Not likely. Though the lawyer may be better than the secretary at both typing and arguing cases, he will fare better by concentrating his energies on the practice of law and leaving the typing to his secretary.” (Blinder) In this particular case, the U.S. has an advantage in terms of capital and technology, while China has the advantage in labor. This clearly explains the emergence of more and more low quality low price goods being imported from China. Instead of artificially inflating the price of low quality tires by domestic suppliers, the government should be promoting free trade and competition which should increase the supply of higher quality tires using more capital, technology, and research and development than the Chinese and could actually create more jobs. It is easy to fear the perceived ability of the Chinese to produce all goods at a lower price than domestic suppliers, but it was Ricardo that put forth the idea of comparative advantage and in this case, the U.S. surely has one in high tech products. According to Adam Smith, “It is the maxim of every prudent master of a family, never to attempt to make at home what it will cost him more to make than to buy...If a foreign country can supply us with a commodity cheaper than we ourselves can make it, better buy it of them with some part of the produce of our own industry, employed in a way in which we have some advantage.” (Blinder)
It seems it is the nature of the local population to see protectionism as in the best interest of their own country because as people lose jobs and domestic industries shrink, it is clearly attributable when a foreign supplier is entering the market aggressively. They wouldn’t as easily attribute the low prices they enjoy, and also the expansion of other related domestic industries to foreign competition. Adam Smith stated, “To expect, indeed, that the freedom of trade ever should entirely be restored in Great Britain, is as absurd as to expect then an Oceana or Utopia should ever be established in it. Not only are the prejudices of the public, but which is much more unconquerable, the private interests of many individuals, irresistibly oppose it. (Smith). The people clearly see a lost job as a terrible thing, as they should, but they are also somewhat blinded to the big picture. It is much easier to point to an empty factory and blame foreign competition, than it is to see another factory still open and know its existence is due to free trade.
The Obama administration is doing its best to restore the economy of the U.S. as well as the world, and also to restore the image of the United States. This latest act of protectionism might have been decided on with the best intentions for the U.S. worker, and very well might save jobs here at home. However, the long term existence of the U.S. as a global financial leader depends on free trade and its trade partners. Alienating China for perceived dumping of low quality products that the U.S. already has lessening interest in pursuing in the market place will only hamper efforts of economic coordination and a global financial relief effort. It can’t be proven how many jobs will be created, it can’t be proven how much the consumer will pay, but has been shown in history that the burden of the load will be on the U.S. consumer, and a full return of the global economy relies on the United States consumer having the income and desire to purchase goods from the global marketplace. Restricting the ability to find low price products if one desires, is a short term fix to a long term problem.
Friday, August 28, 2009
In A Galaxy Far Far Away...
Let's look at a little hypothetical situation.
Let's say an isolated group of people started a civilization. There isn't all that many of them so at first they work together to make sure everyone is surviving and provided for. People that aren't very skilled in simple areas of survival would quickly have to learn from people that are better than them and eventually people would figure out ways to provide food and shelter for themselves and their families. Eventually though, people would realize that certain things they are especially good at. If everyone started specializing in things they are particularly skilled at, services could be exchanged and overall less effort would be put out to achieve the same amount of services they collectively had before.
As the civilization grew and grew, certain groups of people would be particularly good at providing the services needed and the economy would grow as well as the standard of living. Eventually though, people wouldn't necessarily know the people around them as well as they did before because of more and more people living in the civilization. Crime would start to occur as you had people trying to free ride off the success and wealth of other people they don't know. The people decide that they need to enact rules and laws for the people of the civilization to follow in order for everyone to stay happy. At this point, the group is small enough that each person could be involved in each major decision being made and provide their input. Collectively the laws would be a direct result of the feelings and needs of the people.
At some point, the group would grow enough that it wouldn't be feasible for each person to provide their input on every decision being made so the group chooses certain people to act for them, and make decisions on their behalf. This works great as these people can directly find out from their constituents just what is wanted and act accordingly. The size of this government would eventually have to grow proportionally with the population to accommodate more and more people in the civilization. At some point, however, this would stop because the people wouldn't have a clear view of just how much power they each individually have over their representatives. So as this continued, the power of each person to dictate the governments actions would get smaller and smaller. Eventually, there would be so many people being represented by so few, that the individual's power over the government would approach zero.
This, it seems to me, is exactly what has happened with democracy in America. We have so little power, our government is so big and powerful and ruled by a vast public, with each person having no ability to contribute. So, you in effect have a huge government that is governed by a powerless group of people. Just a thought.
Let's say an isolated group of people started a civilization. There isn't all that many of them so at first they work together to make sure everyone is surviving and provided for. People that aren't very skilled in simple areas of survival would quickly have to learn from people that are better than them and eventually people would figure out ways to provide food and shelter for themselves and their families. Eventually though, people would realize that certain things they are especially good at. If everyone started specializing in things they are particularly skilled at, services could be exchanged and overall less effort would be put out to achieve the same amount of services they collectively had before.
As the civilization grew and grew, certain groups of people would be particularly good at providing the services needed and the economy would grow as well as the standard of living. Eventually though, people wouldn't necessarily know the people around them as well as they did before because of more and more people living in the civilization. Crime would start to occur as you had people trying to free ride off the success and wealth of other people they don't know. The people decide that they need to enact rules and laws for the people of the civilization to follow in order for everyone to stay happy. At this point, the group is small enough that each person could be involved in each major decision being made and provide their input. Collectively the laws would be a direct result of the feelings and needs of the people.
At some point, the group would grow enough that it wouldn't be feasible for each person to provide their input on every decision being made so the group chooses certain people to act for them, and make decisions on their behalf. This works great as these people can directly find out from their constituents just what is wanted and act accordingly. The size of this government would eventually have to grow proportionally with the population to accommodate more and more people in the civilization. At some point, however, this would stop because the people wouldn't have a clear view of just how much power they each individually have over their representatives. So as this continued, the power of each person to dictate the governments actions would get smaller and smaller. Eventually, there would be so many people being represented by so few, that the individual's power over the government would approach zero.
This, it seems to me, is exactly what has happened with democracy in America. We have so little power, our government is so big and powerful and ruled by a vast public, with each person having no ability to contribute. So, you in effect have a huge government that is governed by a powerless group of people. Just a thought.
Sunday, August 16, 2009
Playing The Market
The topic of immigration and specifically illegal immigration has been put on the back burner for the time being since our country is tied up dealing with many issues at the moment and really our government has a tough time doing just about anything, not to mention multi-tasking. But this still seems to be a relevant topic considering our high unemployment and even with the 780 billion dollar stimulus package put into action months ago we're still not seeing any growth. Doesn't it make sense that dealing with illegal immigration would support our goal of growing the economy again?
First of all, I have no problem with immigration and I think it should be much easier for people to immigrate to this country. Having productive members of society working, paying taxes, and contributing in our economy is positive and should of course be encouraged.
However, having thousands of people crossing our borders unchecked, working for artificially low wages simply because it's their only option as an illegal immigrant, using our social services at will, and then sending most of the money they make out of the country, presents a problem. If people think that illegals do jobs American citizens won't do, it only means they don't understand how a labor market works. Even if all the illegal immigrants in the country magically disappeared, business would still continue as usual. People would fill the job openings at whatever price they're willing to do the work, and if businesses were unable to still be profitable without the cheap labor, well they just shouldn't be in business.
Even if certain things cost more in the short term, it would still be an overall plus for the economy. We'd have more people with jobs, paying taxes and spending money here, hospitals would no longer have to deal with people using the ER for routine healthcare and then not paying for it, and generally dragging down the economy.
While I don't think that we need to go round up millions of people and just send them away, I still feel utterly embarrassed for the supposedly greatest country on earth when we were apparently the only successful country in history that can't even control it's own borders.
First of all, I have no problem with immigration and I think it should be much easier for people to immigrate to this country. Having productive members of society working, paying taxes, and contributing in our economy is positive and should of course be encouraged.
However, having thousands of people crossing our borders unchecked, working for artificially low wages simply because it's their only option as an illegal immigrant, using our social services at will, and then sending most of the money they make out of the country, presents a problem. If people think that illegals do jobs American citizens won't do, it only means they don't understand how a labor market works. Even if all the illegal immigrants in the country magically disappeared, business would still continue as usual. People would fill the job openings at whatever price they're willing to do the work, and if businesses were unable to still be profitable without the cheap labor, well they just shouldn't be in business.
Even if certain things cost more in the short term, it would still be an overall plus for the economy. We'd have more people with jobs, paying taxes and spending money here, hospitals would no longer have to deal with people using the ER for routine healthcare and then not paying for it, and generally dragging down the economy.
While I don't think that we need to go round up millions of people and just send them away, I still feel utterly embarrassed for the supposedly greatest country on earth when we were apparently the only successful country in history that can't even control it's own borders.
Sunday, April 19, 2009
Is fierce competition a bad thing?
It seems slightly more common lately to think of absolutely fierce competition to be something not in the best interest of everyone and is maybe frowned upon. We sit around and talk about greedy oil companies and fierce bottom lines of Wal Mart and others and disapprove of them. We’re talking about helping the poor, sharing the wealth, spreading it around, thinking more about unemployment benefits and higher taxes than making a buck. We’re borrowing money at a rate unseen in our history. We have more and more programs designed to help people that can’t make very much money. They’re behind on payments, but we’re going to help them out. When you really think about what’s going to get our country back to where it’s supposed to be, it’s probably not billions of dollars of borrowing and hand outs. It’s definitely not the billions of dollars of borrowing to fight a seemingly endless war on two fronts. We’re sending more and more troops to Afghanistan and why? We were never sold on this war like the Iraq war. We need to do things to promote competition. We’re doing things to hurt competition like having unbelievable union wages and allowing illegal aliens to come in and take jobs that citizens would actually take. Why do people think that competition would not allow for business to run as normal with no illegal aliens here? It’s called a labor market and it actually exists out there. People will work manual labor jobs if they’re paid the right price. If a particular industry can not function paying its workers a fair wage then it just shouldn’t exist. The market will take care of it. Just a thought.
Friday, January 23, 2009
Economic Stimulus
With the election and inauguration of Barack Obama finally over, we can put all the campaign speeches, attack ads, campaign promises, debates, and general hoopla of this ordeal of a Presidential campaign behind us. I think it is a worthy side note that this campaign has grossly outdone all other campaigns before it in all possible criteria including the time spent campaigning, money spent, etc. It seems pretty obvious that this is not in the best interest of the United States to have Presidential campaigns run most of two years when the elections themselves are only ran every four. However, that is neither here nor there and with our new man at the helm of this ship we all live in and depend on, one quickly taking on water so to speak, it has been made clear that changes are on the way.
In his first one hundred days as commander-in-chief, Obama has made it clear one of his goals is an economic stimulus package. A lofty one tat that. 825 Billion dollars is the closest estimate of this behemoth spending bill on track to be signed, sealed, and delivered by Presidents Day. You might be asking yourselves, "Wait. How can the United States spend $850,000,000,000.00 right now? If you are, you might be one of the 1% of Americans who haven't yet been hoodwinked into believing that the federal government is the only thing that can save us from this mess we're in. The correct thing to do is basically the answer for every problem which involves the government in any way. CUT TAXES.
Let's think about this. If you provide an "Economic Stimulus" check to every taxpayer in the country, you would in theory be causing spending to go through the roof once they're all delievered and in the economic climate we're in, one of bankrupted businesses and stagnant spending, this is good right? Well, not so fast. Maybe we should ask the best economists about this. If you dig into the idea of a federal stimulus check you'll see that modern, Chicago Economists generally agree that doing this has an unwanted consequence, and it in effect exposes a flaw in the thinking of left-leaning socialist-loving democrats in this country. It is, that people who make the most money in this country are the ones who create all the jobs. Jobs are, after all, one of the most important factors in determining the strength of our economy. If rich people are the ones creating jobs then we must assume they use their money to create jobs, they do this through investment. They invest when interest rates are low, and when they don't have a foreseeable jump in their expenses in the near future. We can all agree that you might be discouraged from buying a new car if some big expense like, say your house payment will double next month. That's how it works with an economic stimulus package. The rich know they are going to be paying for this stimulus in the form of higher taxes, therefore they don't spend the extra money they're getting (they're smart) and they might even save more than they normally would, since they know their share of paying back the stimulus will be more then their share, (progressive tax structure).
Now, if we want rich people to save more, and in general maybe this country should think about saving more, then this stimulus package will work. However, with rising unemployment, steady inflation, and growing distrust of the country's financial future, this is probably not the time to emphasize saving.
Not to mention the fact that this country is BROKE. We have no money. Read it again. The federal government of the United States has NO MONEY. If it wants to spend money, it has to print money. Does anybody think this is a good idea right now? We are trillions of dollars in debt already, and we want to go out and spend 850 billion to "stimulate" the economy?
The good news is that I have the answer. Shrink the size of the federal government, get out of Iraq as soon as we possibly can while still maintaining the integrity of our national security, and cutting taxes. If you cut taxes and also give taxpayers reason to believe their taxes won't soon increase, then they actually will spend and invest it in long term ventures that might actually create more wealth and jobs.
In his first one hundred days as commander-in-chief, Obama has made it clear one of his goals is an economic stimulus package. A lofty one tat that. 825 Billion dollars is the closest estimate of this behemoth spending bill on track to be signed, sealed, and delivered by Presidents Day. You might be asking yourselves, "Wait. How can the United States spend $850,000,000,000.00 right now? If you are, you might be one of the 1% of Americans who haven't yet been hoodwinked into believing that the federal government is the only thing that can save us from this mess we're in. The correct thing to do is basically the answer for every problem which involves the government in any way. CUT TAXES.
Let's think about this. If you provide an "Economic Stimulus" check to every taxpayer in the country, you would in theory be causing spending to go through the roof once they're all delievered and in the economic climate we're in, one of bankrupted businesses and stagnant spending, this is good right? Well, not so fast. Maybe we should ask the best economists about this. If you dig into the idea of a federal stimulus check you'll see that modern, Chicago Economists generally agree that doing this has an unwanted consequence, and it in effect exposes a flaw in the thinking of left-leaning socialist-loving democrats in this country. It is, that people who make the most money in this country are the ones who create all the jobs. Jobs are, after all, one of the most important factors in determining the strength of our economy. If rich people are the ones creating jobs then we must assume they use their money to create jobs, they do this through investment. They invest when interest rates are low, and when they don't have a foreseeable jump in their expenses in the near future. We can all agree that you might be discouraged from buying a new car if some big expense like, say your house payment will double next month. That's how it works with an economic stimulus package. The rich know they are going to be paying for this stimulus in the form of higher taxes, therefore they don't spend the extra money they're getting (they're smart) and they might even save more than they normally would, since they know their share of paying back the stimulus will be more then their share, (progressive tax structure).
Now, if we want rich people to save more, and in general maybe this country should think about saving more, then this stimulus package will work. However, with rising unemployment, steady inflation, and growing distrust of the country's financial future, this is probably not the time to emphasize saving.
Not to mention the fact that this country is BROKE. We have no money. Read it again. The federal government of the United States has NO MONEY. If it wants to spend money, it has to print money. Does anybody think this is a good idea right now? We are trillions of dollars in debt already, and we want to go out and spend 850 billion to "stimulate" the economy?
The good news is that I have the answer. Shrink the size of the federal government, get out of Iraq as soon as we possibly can while still maintaining the integrity of our national security, and cutting taxes. If you cut taxes and also give taxpayers reason to believe their taxes won't soon increase, then they actually will spend and invest it in long term ventures that might actually create more wealth and jobs.
Tuesday, November 4, 2008
Enter Barack Obama
In a few hours Barack Obama will most assuredly be voted into office as the President of the United States of America. It will mark an important milestone and accomplishment for our country, as we see that equality for all people is still taking strides and today it takes shape in a black president. I think the Democrats and basically all those opposed to George Bush from day one deserve Obama's presidency. They felt they were cheated in 2000, and they felt neo-conservatism and smear politics snatched Kerry's chances in '04. Now they have a perfect political storm brewing and nothing can stop their man this time. They deserve it. I feel like if John McCain wins this election - like he has a chance- we'll have half the country happy to see a Republican still in office but only mildly excited about the chances of a rebound for our country economically and in a worldly sense. Yet, on the other hand, we have a group of people standing behind Barack Obama truly inspired by his words and fully expecting his Presidency to bring the "change" the masses are anxiously awaiting. I don't totally understand what this change is going to look like. or what exactly is going to change but neither do most of the Obama supporters. They just want change in general and they're going to scoop up whatever Obama wants to send their way. I can see why. They see our country in a dead-end war looking more and more unintelligent and out of touch in the world and yet at the same time in the midst of a catastrophic economic collapse affecting literally millions of Americans, They want this all to change.
I'm still not voting for Barack Obama. This is what I know about him: His underlying believe and desire is for fundamental change in the US. Does this not scare you people? What change is he talking about? He wants money in the hands of haves, going to the have-nots. He's Robin Hood with with millions in big money financing and a flag lapel. Or sometimes not. He has raised more money than any other candidate in history yet George Bush received more from small donors. What does this mean? He claims to be a man with his own values and ideas not controlled by the Washington Elite yet instead, he gets introduced to the public as a politician by convicted terrorist Bill Ayers, decides to conduct financial dealings with Tony Rezko, a now indicted felon, and spends two decades attending the Chicago Trinity United Church Of Christ listening to the ranting of one Mr. Jeremiah Wright and feeling so comfortable about the man he chose him to baptize his children and be the priest for his wedding. We've all heard Rev. Wright's ideas of America and his hatred of White America, yet most as voters completely disregard any mention of this. Does it not matter? Maybe not. Maybe Wright's ideas were like a "crazy uncle" as Obama calls him and didn't actually sink in to or represent those listening. If you listened to Michelle Obama you might think otherwise. She has called the United States a "downright mean force in the world" and has recently claimed that only now is she proud to call herself an American. Is this who we want in the highest office of the land?
Tomarrow will bring hope to a lot of people and that is a good thing. Let Obama have his chance. Let the Democrats rule all three branches of the Federal Government and do what they can to bring this "change". Let them tax the rich and pretend that will bring wealth to poor people. Let them pretend that we can just snap our fingers and bring free health care and education to all that want it. Let them think that those around the world who despise America will re think their position with Barack in the oval office and decide to never plan another terrorist attack again. Let them think anything they want about this facade Barack Obama. They deserve it.
I'm still not voting for Barack Obama. This is what I know about him: His underlying believe and desire is for fundamental change in the US. Does this not scare you people? What change is he talking about? He wants money in the hands of haves, going to the have-nots. He's Robin Hood with with millions in big money financing and a flag lapel. Or sometimes not. He has raised more money than any other candidate in history yet George Bush received more from small donors. What does this mean? He claims to be a man with his own values and ideas not controlled by the Washington Elite yet instead, he gets introduced to the public as a politician by convicted terrorist Bill Ayers, decides to conduct financial dealings with Tony Rezko, a now indicted felon, and spends two decades attending the Chicago Trinity United Church Of Christ listening to the ranting of one Mr. Jeremiah Wright and feeling so comfortable about the man he chose him to baptize his children and be the priest for his wedding. We've all heard Rev. Wright's ideas of America and his hatred of White America, yet most as voters completely disregard any mention of this. Does it not matter? Maybe not. Maybe Wright's ideas were like a "crazy uncle" as Obama calls him and didn't actually sink in to or represent those listening. If you listened to Michelle Obama you might think otherwise. She has called the United States a "downright mean force in the world" and has recently claimed that only now is she proud to call herself an American. Is this who we want in the highest office of the land?
Tomarrow will bring hope to a lot of people and that is a good thing. Let Obama have his chance. Let the Democrats rule all three branches of the Federal Government and do what they can to bring this "change". Let them tax the rich and pretend that will bring wealth to poor people. Let them pretend that we can just snap our fingers and bring free health care and education to all that want it. Let them think that those around the world who despise America will re think their position with Barack in the oval office and decide to never plan another terrorist attack again. Let them think anything they want about this facade Barack Obama. They deserve it.
Subscribe to:
Posts (Atom)