President Obama's Stimulus Package
By bobmnu
@bobmnu (8157)
United States
January 27, 2009 11:09am CST
The question has to be asked how to you grow the economy? You grow the economy by creating new wealth. President Obama's plan is to spend lots of money and create more government work. To do this he has to raise taxes, print more money or both. President Obama is proposing spending 1 trillion dollars to get the economy going. He is proposing to spend the money on many different projects See this site for a list of the projects http://www.ktlkfm.com/pages/chrisbaker.html and read the following article:
"THIS IS STIMULUS? LOOKS LIKE POLITICAL PAYBACK INSTEAD
Monday 01-26-2009 7:10pm CT"
This program will put money into the economy but it will not grow wealth. To grow wealth you have to take $1,000.00 and make something that is worth more and then sell it and take the extra money and make more and sell more and make more money. Each time you recover your costs and then some so that you have extra money to buy more raw product or hire more people to work for you. How do you get the money to invest. President Obama could give us more money to invest next week if he reduced business taxes and individual taxes. Some people would pay down their debt, but some would take the money and invest it to produce more wealth. If you put it in the bank the bank has money to loan, if you buy stocks the business has money to expand and produce more. Just putting money into the economy does not create new wealth and grow the economy. Investment does.
6 responses
@will19 (15)
•
27 Jan 09
PLEASE TAKE TIME TO READ, I KNOW ITS LONG.
Yes putting money straight into the economy would not grow wealth, but that is nothing like he is proposing, nowhere in his list of stimuli does it say injectionj of cash into the economy. It is all about the grow of industry and creating more jobs, which in turn reduces unemployment and hence more people contribute to the economy and so stregthen it. A stronger economy will in time increase the value of currency and so increase wealth.
Look at the UK at the moment, as banks started to collapse, the economy collapsed, investors lost faith in the economy and so the worth of the £ fell. To get the US economy back on track you first need to stabalise the economy, and restore faith in it to encourage investment. There is no point investing in something will is worth nothing; with the markets falling he would lose money on the value of the $ if he invested. So he has to rebuild the economy to start with.
And why would lending money directly to the banks and businesses help??? Yes they need to be bailed out, but their excess lending got us in this mess in the first place and giving money directly to business does not suddenly mean every country in the world will want to buy their higher output of items, it is pointless increasing output if there is no one to buy it. To get out of this situation, stability is what is needed.WHich is what he is looking to make.
SO no investment is not the way to get out of this crisis as there is nothing to invest in, there would just be more worthless shares, the investing is for us to do when the economy is stable and rising again. Obamas job is to fix the economy, which is what he is proposing, the wealth will naturally follow.
@Taskr36 (13963)
• United States
27 Jan 09
The stimulus package should be used to create necessary jobs. Instead there is crap in there like "$50 million for the National Endowment for the Arts, $20 million for sodding the National Mall, $400 million for climate change research and $200 million for contraception programs"
That right there is over half a billion spent on crap. National Endowment for the Arts isn't even remotely essential to anyone. I couldn't care less about the sod at the National Mall. The last two are just offensive in that they waste the most money on crap that is purely to promote the liberal agenda and does ZERO for the economy or job creation.
Just to give you a comparison the Miami Herald put out an excellent article a month ago about programs being proposed in Miami-Dade County that will create jobs and benefit the entire county. It listed the approximate costs, and jobs created by programs involving things like public transportation that benefit the entire county.
@Benjaminna (300)
• United States
27 Jan 09
I could care less about the sod for the National Mall either. If it needs re sodded maybe they should have charged all those people $20 each for admission for destroying it.
@uicbear (1900)
• United States
27 Jan 09
I so agree with you and am glad to see your post. Obama's plan is to get poeple back to work, putting the money into projects that will help not only the economy by creating jobs(lots of construction), but they will also help the US(focusing on creating alternate energy) and people.
They said that the first plan was to help the banks and give them money to lend out to businesses so they could keep up with payroll and overhead. well, with the amount of businesses laying off, and cutting back this doesn't seem to be doing the trick. If I don't have a job to buy goods and services, the business doesn't need to have the people to provide me with those goods and services. I think it's about time that this problem is attacked from the bottom up.
1 person likes this
@SeoulBoy_Art (193)
• Japan
28 Jan 09
Tax cuts have proven time and time again they don`t work.Millions of people out of work and losing jobs everyday and some people are screaming for a tax cut.Hell we had a surplus when bush came into office which he promptly gave to the wealthy ib the form of a tax cut .Now we have debt that will take years to pay off. And you expect us to agree to another tax cut for. How is giving a $1000 tax cut going to help someone who has lost their job other than to help them pay a bill or two.
@amitksing (1323)
• India
28 Jan 09
Fighting the economic crisis is definitely a big challenge for Obama.. and it will be worth watching how he manages to do it!
@anniepa (27955)
• United States
27 Jan 09
It would seem to me that if tax cuts were the way to grow the economy we wouldn't be in the shape we're in today after Bush's tax cuts for the wealthy. If something isn't done to help the middle class all the tax cuts for the wealthy in the world aren't going to get our economy going again. The rich will just sit on their wealth and get richer and the rest of us will continue to suffer.
Annie
@bobmnu (8157)
• United States
28 Jan 09
There are several factors that lead to the current financial meltdown and tax cuts were one of the factors. You had a policy that REQUIRED the banks to loan money to people with out regard to their ability to pay back the loan(Community Reinvestment Act), Fanny Mae and Freddie Mac buying the bad loans and putting some good loans with the bad and reselling them to banks and insurance companies with the loans being guaranteed by the promise of the Federal Government through Fanny and Freddie. Then you had Senator Schumer (D,NY) release a letter saying a bank (Indy Mac) was going to fail and it caused a run on the bank, even though the deposits were insured and the people would get their money. The final straw came in October when Federal Regulators took over several banks under the Banking Reform Act from the New Deal under FDR. This act stated that banks had to have a value to loan ratio in the area of 80 to 90%. If you had a $100,000 loan on a house that was now valued at $60,000 you had to call the loan or get $50,000 payment to bring the loan to value ratio in line. This even though the people were making the monthly payments and were current. This crisis was caused by a cascade of events that could have been stopped. There were too many politicians (both parties) that benefited from cheep housing costs and increasing housing values. Despite President Bush warning several times
http://www.youtube.com:80/watch?v=cMnSp4qEXNM&NR=1
of the looming crisis but nobody was listening especially in Congress. The media was too busy bashing him to see the real news.
@rodney850 (2145)
• United States
27 Jan 09
Bobmnu,
The Dow is presently just above 8000. If Obama's "stimulis" package is passed in it's present form we will see it bottom out in the 3 digits maybe somewhere around the 600-900 levels. Investors will seek investments outside the US and pull all of their money out of the stock market to avoid the "second shoe" that will be in the form of huge tax increases on the wealthy in an attempt to redistribute the wealth. What Obama plans to do will put a huge and devastating burden of the very people he swore to help and that is the lower-middle class taxpayer.
@momtrying2makeit (3270)
• United States
27 Jan 09
I am not sure what the plan is I have read so many things about it online. I was thinking that he might offer another stimlus check but it seems from me that is not going to happen. I feel the plan is mainly set on creating more jobs and becoming less dependent on other countries as well. To me that seems like a good plan but will it work is the real question? I hope for the best but I still think we as a coutry should keep holding back and saving money as much as we are able too. I do not think the econmny will change over night. It took a long time to get into the mess and it will take a long time to get out of it as well. Like I said I hope for the best and good luck with your discussion here. happy mylotting to you as well. 
@bobmnu (8157)
• United States
27 Jan 09
The plan is mostly doing repair work to government buildings. A business plans and saves money from their income for maintenance and new building while the government takes the income spends it all every year so when they need to do repairs or build more they have to have a bond issue (borrow the money) and raise the money that way to pay for the building and maintenance. What he is doing would be like you going down to the bank to borrow money to pay someone to mow your lawn. You are helping the person who mows the lawn but it is going to cost you more money when you have to pay back the loan and next week you have nothing to show for your money.
