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Everybody knows by now that the US House passed an economic stimulus package today, though it's still not a done deal since the Senate is looking to pass its own similar but expanded version. No reason to beat a dead horse here, so lets leave it at the whole package is going to cost us around $150 billion (roughly one percent of GDP).
But here's something that will make you go "hmmm"...
Late last year as the deadline was looming for Congress to either get an AMT patch done or hold its peace until next year, the House was forced to pass the Senate version in the eleventh hour to avoid having the proverbial millstone hanging around its neck in an election year. The sticking point? They didn't want to pass a bill that would eliminate $50 billion in tax revenues without paying for it through spending cuts or tax increases elsewhere.
Here's another newsflash . . . where do you think the $150 billion getting paid out under the stimulus package is coming from? That's right, no where.
So an unfunded $50 billion fix for a flawed tax code is problematic, but the House, the Senate and the Administration are tripping over themselves to give away $150 billion with no way to pay for it?
If we're adding that much to the national deficit, I for one would like something show for it, especially since my tax dollars will be going towards just paying the interest on that for the rest of my life. And that much cash would do wonders for our national infrastructure and create more sustainable GDP growth, though admittedly it would be slower in showing up on the national accounts.
What really makes me nervous though is that lackadaisical credit standards and easy money is what got us into this mess, and what makes the US government a more worthy borrower? Yeah, you've got that whole full faith and credit thing, but one of these days the rest of the world may realize that promissory note's not worth much more than the fiat currency it's printed on.
I'm not some hard dollar fanatic who keeps his life savings in gold bars stashed under the mattress (at least if I were, I wouldn't broadcast it over the internet), but I'm irritated by the fact that my grandchildren will be paying for the bailout. This was an entirely preventable situation, and truth be told, I feel like the responsible parties should be held responsible.
I say we send the bill to the major players who got knee-deep in the subprime muck. Heck, I'd even be nice and let them pay it off on an installment plan. Looking at the pay scales and bonuses at the major Wall Street players, plus the ridiculous profits made from subprime lending, they should be able to pay it off in about five years (and that's a conservative estimate). And letting the private sector pay it off in a matter of years, versus the governments timeframe of generations, is a lot more palatable.
But that's purely my two cents.
posted by Benjamin Shepherd
But here's something that will make you go "hmmm"...
Late last year as the deadline was looming for Congress to either get an AMT patch done or hold its peace until next year, the House was forced to pass the Senate version in the eleventh hour to avoid having the proverbial millstone hanging around its neck in an election year. The sticking point? They didn't want to pass a bill that would eliminate $50 billion in tax revenues without paying for it through spending cuts or tax increases elsewhere.
Here's another newsflash . . . where do you think the $150 billion getting paid out under the stimulus package is coming from? That's right, no where.
So an unfunded $50 billion fix for a flawed tax code is problematic, but the House, the Senate and the Administration are tripping over themselves to give away $150 billion with no way to pay for it?
If we're adding that much to the national deficit, I for one would like something show for it, especially since my tax dollars will be going towards just paying the interest on that for the rest of my life. And that much cash would do wonders for our national infrastructure and create more sustainable GDP growth, though admittedly it would be slower in showing up on the national accounts.
What really makes me nervous though is that lackadaisical credit standards and easy money is what got us into this mess, and what makes the US government a more worthy borrower? Yeah, you've got that whole full faith and credit thing, but one of these days the rest of the world may realize that promissory note's not worth much more than the fiat currency it's printed on.
I'm not some hard dollar fanatic who keeps his life savings in gold bars stashed under the mattress (at least if I were, I wouldn't broadcast it over the internet), but I'm irritated by the fact that my grandchildren will be paying for the bailout. This was an entirely preventable situation, and truth be told, I feel like the responsible parties should be held responsible.
I say we send the bill to the major players who got knee-deep in the subprime muck. Heck, I'd even be nice and let them pay it off on an installment plan. Looking at the pay scales and bonuses at the major Wall Street players, plus the ridiculous profits made from subprime lending, they should be able to pay it off in about five years (and that's a conservative estimate). And letting the private sector pay it off in a matter of years, versus the governments timeframe of generations, is a lot more palatable.
But that's purely my two cents.
posted by Benjamin Shepherd
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