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Stimulus or spending?

February 18, 2009 - John Stack

I've finally decided on my feelings about Obama's stimulus plan : I think its a good idea. I think I may have irritated a friend today, becuase she wrote on her FaceBook page ' Well, Obama signed the 800 Billion SPENDING bill' and I mocked her. Well, is it stimulus, or just spending? Well, YES! there is an old adage 'You gotta spend money to make money'. A GOP slogan seems always to be along the lines of 'and we're putting money back in the hands of those who need it, and know what to do withg it, the working people of America'. Well, tax cuts on their own don't put money into people's hands. If you are unemployed, tax cuts don't do jack for you RIGHT NOW. That's why I think this plan has legs.

Tax cuts are needed to help spur the economic engine. Certain directed tax cuts have often showed that they can help move an economy, be it a town tax break, or a federal tax break. But tax breaks basically are 'trickle down'. Tax cuts give people and business the room to spend the money heretofore spent on taxes on ways to make more money, such as expanding a plant  or hiring more workers. There are also a myriad of instances where tax cuts just go to line the pockets of the business owners, who end up adding nothing to a local tax breaks. My father worked for a company who would get a tax break for creating so many jobs. All of a sudden, my dad who worked for one company, was working for another company. Yet, he parked in the same lot. His desk never moved. His boss was the same. It was just a swindle of taxpayer dollars. So, taxbreaks don't always do as intended (See Empire Zones)

Also, people need to get money RIGHT now. They can't wait a year while the local plant builds up a new addition and goes about hiring new workers. They need something now. And Obama's package does that. It puts people back to work, and money in their hands - but by working for it, not by the governemnt spending 145 Billion to just give money away, as Bush's last stimulus plan did (yeah, 145 billion with no strings attached, and the GOP ate it up!) Now, Obama plans to put money where it is needed. 3,000 miles of electrical transmission lines are planned to be built. These are extremely long overdue, with our tremendously over burdened power grid trying to chug along. But, to get the money through regular channels, it never happens. Is there pork in the bill? Heck yeah! but what is one man's pork, is another's stimulus. You can claim the power lines are pork for the electrical companies. I'll say it is stimulus to make sure our power infrastructure can meet all of its needs. For example, recentl;y a company was looking to build one or 2 wood pellet  plants. Along with access to forests and skilled workers was the need to have a reliable power source that could meet its power demands. Therefore,the access to reliable power is a stimulus way beyond the 1st level users.

Some oddities about the whole paln is what many of the opponents are saying. Of course John Boehner (minority leader) was against the plan. He of course wanted (what else ) tax cuts, tax cuts and throw in some more tax cuts. The GOP claims the 'spending' plan is too slow,a nd somehow, tax cuts would be near immediate. Huh? The government can hand over millions to some company wanting to build a plant for solar panels. Or, the company can go out, make a plan to find investors (real tough normally, but near dry now), build the new plant, wait 3 months afterwards and apply for their tax credit. Hmm. the slow pace of spending vs tax cuts. Also, remember, atx cuts aren't free. If the tax cuts equals $750 billion, you have to come up with the $750 billion. Then, hope it 'spurs' the economy. Or, give directed monies to deserving companies, who will immediately buy goods (helping suppliers stay in business, keeping people off unemployment), hire people (lowering unemployment, welfare, etc) which will increase tax base just by them working and help spurn other co-dependent industries.

Is there room for graft? Of course. Is lots of money going to be spent unwisely?Yes it will. but, a lot of it will be spent very wisely, creating tens of thousands of new jobs.

But most crazy is the common right wing lament - its just a socialist  spending plan, and that's where Obama and the democrats are leading us. Give me a break. Because we are spending rather than cutting taxes, why does that portend Socialism?Marxism? Communism? The whole idea is to get the government to help BUSINESS and TAXPAYERS making more money. The better this plan does, ironically, the less we as Americans will need the government!

By the way, I'm one game behiond in the Pine St Pool League , and Frenchie 'Hit it hard, No English' is still holding up the spot most Republicans do today, the back of the line...

 
 

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