A good place to start is the beginning. How did we get here? I provided a chart of where the jobs were before January 20, 2009 and where they were in 2010. The Obama Administration identified three areas that needed attention to avert a depression. They agreed to continue the Bush Administration's $700 billion bailout to stabilize Wall Street. That worked, in fact, we made a little money on that. The Obama Administration bailed out GM and saved over a million jobs and revived the auto industry, instead of letting it fail. The second area of concern was that the states would lay off a lot of teachers, firemen, and police officers when they balanced their budgets and extending unemployment benefits. The administration knew that a one trillion stimulus would not pass even though the house, and the Senate were controlled by Democrats. The Senate had that 60 vote filibuster and the republicans used it many times. Congress finally passed an $887 billion stimulus package but in order to get three republican senators a little more than a third was non stimulant tax cuts. President Obama admitted that he did not know that they weren't that many shovel ready jobs, so the infrastructure part of the stimulus package was as not as successful as it should have been. Vice President Biden also admitted that they misread the economy they inherited; it was much worse than what they thought.
History will judge the initial stimulus package because it's difficult to say how many jobs it created or saved. "The non-partisan U.S. Congressional Budget Office said on Wednesday the economic stimulus plan enacted in 2009 boosted U.S. employment by as much as 3.5 million people in the final quarter of last year.
The report said the cost of the economic program enacted by the then Democratic-controlled Congress and signed into law by President Barack Obama totals $821 billion when calculated over a 10-year budget window. The original cost estimate was $727 billion.
The administration did not ever find a way to revive the housing market and the jobs package they just submitted, does not have a plan to do that. The administration tried, tax credits but, unless demand and unemployment comes down, it's just throwing money down the drain. I liked the idea Lakewood. Ohio is using to eliminate nuisance homes to help the economy. “Razing houses, officials say, will increase competition for the remaining homes, driving up real estate values. That in turn, will make it easier for homeowners to refinance to cheaper loans, freeing up spending and boosting consumer confidence.”
The president's jobs bill cannot be passed as a single package because it will have to go through several committees. Since 60% of the jobs packages are tax cuts, it will have to be approved by the House Ways and Means, the infrastructure by the committee on Transportation and Infrastructure, etc. It is a revenue-neutral bill that will be paid for by adding it to the debt reducing package, the super committee will deal with.
The American people want the government to do something about our economy and particularly jobs. That's why over 31million people tuned into watch the president's speech. The package is not a cure all because we are in a world economy where we depend on our European, Asian, and South American trading partners. The president talked about selling electric cars to China but there is a little problem there. China said that they will buy our electric cars, but we need to give them the technology. You can see where that would lead. When people say it's really easy, it's a sure sign that they don't know what they're talking about.
We are supposed to withdraw all out troops from Iraq by the end of the year but there are some rumors we will leave 3,000 troops in Iraq. That alone will save a lot of money. It was surprising to hear Senator John McCain say that “we won't go to war in the Middle East, again." It's seven years too late, Senator McCain.
We will never agree on everything because we don't have an economic truth certain. The public library has a lot of books with different versions about how the 1929 Depression began and how it ended. We know the basics of not spending more than what we take in, but they are a lot of variables that are not under our control. Our country will continue to deal with the fires, floods hurricanes and tornadoes, even though we have a huge deficit and debt. I don't have the answers and evidently few do, but that doesn't mean we can't have an opinion. In order to pass anything, it has to pass the house, the senate, and get signed by the president before it becomes law. The president of the United States like a quarterback, is just one pawn in a chess game; an important one, but one that can be beaten by a congress with a 13% approval.
There are some that say, if we lower the corporate rate, cut the capital gains tax to zero, leave in the corporate tax loopholes, we will have economic prosperity. I wonder if we could get them to sign a pledge guaranteeing prosperity or pay double of what their amount would have been. We had two tax cuts in the Bush presidency, look back up at the chart and tell me if it worked!
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