Tuesday, February 10, 2009

The Economy Will Remain Broken Until Washington Is Fixed

Glenn Reynolds, over at Instapundit, links to a Politico article on how the Democrat activist organizations are starting to attack the Republican Congressional leadership in an effort to turn around public perception on the Stimulus Bill. Fine... that's politics after all, but I don't understand Reynolds' comment that he's "tired of it." Tired of what? The GOP leadership? Or, attacking the GOP leadership? I think many Americans were hoping that Hope and Change meant hoping for true bipartisanship, for putting country above party, and for changing the way things were done... but despite all the hope nothing has changed. Certainly the Democrats haven't changed.

The Democrats own the Stimulus Bill. Speaker Pelosi and the House Democrat leadership wrote the bill, and Senator Harry Reid and his fellow Democrat senators put together the Senate version. Democrats will control the conference committee that ends up deciding what the final outcome will be. As Obama, Pelosi, Reid, MoveOn, DailyKos, etc., are so fond of reminding us, they won. They are going to use their control of the Legislative and Executive branches of the government to ram this spending colossus through and nothing is going to stop them... not public opposition, not the CBO report that shows doing nothing is a better strategy, and certainly not the greatly outnumbered Republicans. Chances are the eventual bill won't even be made public until after Obama signs it.

It wouldn't be such a big deal if we were just talking about the fate of one or the other political parties, which after all are really just associations of like-minded folks banding together to move things in the direction they want. Who gives a fig? However, the Stimulus Bill is more than just partisan politics. We're talking somewhere north of $800 billion dollars here. Do you realize just how much money that is?

Here's some comparisons that will help you wrap your mind around the enormity of the $800+ billion we're going to print and spend, and obligate ourselves:
  • We could select 16,000 random folks (yes, 16,000!) in each of the 50 states, and give them a million dollars
  • We could give 10% of the population of New York City a million dollars each
  • We could give every man, woman, and child in the country a new computer, a new iPhone, a new digital camera, and a 42" LCD HD TV... and still have enough money to pay their cable bill for a year
  • We could give every American family a three-month paid vacation, at the average salary

Does anyone really believe that the way to get out of debt is to indebt oneself even more? Of course not. The first thing a smart person does when facing a shortfall is to cut spending, not raise it. After all, if spending like a drunken sailor would get us out of our difficulties, we would never be here in the first place.

The Financial Times had a great article on the cause of our current economic woes, and the possible solutions. What I don't understand is, if Tim Geithner is the financial genius who is uniquely qualified to fix the problem, then why didn't he cover these points in today's press conference... you know, the one that drove the Dow down several hundred points, because investors realize the Obama Administration doesn't have a clue about how to proceed and is flailing desperately. What was their solution? Let the bad banks fail, and stop throwing good money after bad. Yes, bank investors will lose money. That's what happens when you invest in a business that makes bad decisions.

All of the political posturing we've seen over the last week is just so much kabuki theater. The truth is really rather simple: the Dems want Republican support so that everyone owns this stinker of a bill... and no single party can be held responsible.

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