Multitudes are bidding up stocks and are, more broadly, expecting good things for the economy, because of America's second "stimulus" plan. The first one, hastily put together a year ago, did manage to prop up stock prices long enough to let all who saw matters clearly exit the market at attractive prices. This one has now been described today by the Pres-Elect. This blog would like to be an "Early Responder" on a hot Miami afternoon in winter.
What follows are Obama quotes in boldface and DoctoRx responses.
" . . . we risk falling into a deflationary spiral"
-Puh-leese! Ben knows how to pilot the Fed-i-copter. Since the Fed was created, money has lost about 97% of its value. Prior to creation of the Fed, prices were stable over centuries in this country. In any case, prices are up substantially over the last several years. A little settling back would help all consumers and savers.
"We'll put people back to work . . . building wind farms and solar panels; fuel-efficient cars . . ."
1. Wind farms and solar panels are highly cost-ineffective at anywhere near current energy prices. So, the cost per job will be gigantic. Welfare would likely be cheaper.
2. The Japanese, Koreans, and even Americans are already building fuel-efficient cars. Prius sales were down about 50% in November. Government should not direct production of one type of car or another. Tax incentives, gasoline taxes, etc. are perfectly adequate for those purposes.
"I will need and seek support from Republicans and Democrats . . ."
No, you don't need Republican support. What you are signaling is that Republican legislators, Governors and mayors can be sure that their constituents will share in the loot.
"What is not negotiable is the need for immediate action."
There were no significant Congressional hearings before the first stimulus package, the Bank of America-written housing bill in the summer, the TARP bill, etc. Congress has been lounging around all December and will continue to do so until they must show up in a cold D.C. this month. Where are the hearings and the research?
Translation: We let Bush and Paulson reward their friends with hundreds of billions of dollars. It's our turn now.
"Right now, there are millions of mothers and fathers who are lying awake at night wondering if next week's paycheck will cover next month's bills . . . These Americans need help, and they need it now."
This should argue for help to states for unemployment insurance, Medicaid, etc. Yet the plan is all about construction and a "down-payment" on something or other. The future, I think it is. Thus the invocation of people who are indeed hurting is irrelevant to the "stimulus".
Overall comment: Mr. Obama stated he intends to sign a bill promptly after taking office. One would think that for this alleged emergency, Congress would have been working non-stop to evaluate how best to spend the money, with safeguards against the inevitable waste and fraud that go into gigantic construction projects.
I conclude that the stimulus program is a fraud. Money will be borrowed from savers in the U.S. and worldwide, and/or printed out of thin air, for projects that will largely occur when the cyclical downturn has become a cyclical upturn. Many projects will never be completed. Some years from now, it will be reported on how large a percentage of this program was wasted.
Sen. Obama voted for the bogus "stimulus" package of a year ago, most of which helped out financial institutions, as most of it was saved. He voted for the alleged housing assistance bill this summer, which was reported to have been essentially written by Bank of America, and which was recently reported to have helped out almost no homeowners.
He voted with the rest of the Establishment for the corrupt bail-out "TARP" bill.
He was a gigantic recipient of Fannie/Freddie lobbying money in his short tenure as Senator.
There should be no doubt: This is a Government of continuity. The only real change is which branch of the Establishment is now ascendant. The ancien regime concluded that with the Bush/Republican brand in disrepute for the nonce, a biracial, well-spoken man would serve its interests better than a former President's wife. Help is on the way- for the entrenched powers in this country. But not for anyone you know- except "contractors". And not for investors- not yet.