Tonight, I just want to remind anyone who might happen across this place in cyberspace that the economic “stimulus” package, while being criticized as being too much spending, is probably WAY to small.  The problem, I believe, is WAY bigger than most people realize.  We have been putting off this “reckoning” with phony economic theories for over 30 years.  In my mind, the only President I can remember with the guts to call it straight was Jimmy Carter, and, of course, he was run out of town due to the hostage crisis in Iran during the election of 1980.  He had reduced the, what at the time was huge, budget deficit of the Nixon/Ford years by about half when he was defeated by Ronald Reagan, who initiated the ridiculous claim which in a nutshell said; “I’m going to reduce taxes and balance the budget.”

That made no sense then, and it made even less sense when George W Bush said essentially the same thing as he took over in 2001.  The difference, of course, was that Bush inherited a $250 Billion surplus – which he frittered away in just a couple of months of incredible tax cuts for people who absolutely didn’t need them.  Bush always says he took over during a recession, but the truth is that the recession didn’t start until he was in office for about 3 or 4 months – soon enough, of course, to deflect the blame from their tax cutting strategy (which put the government in competition for available money to be borrowed and, in my view, instigated the dot-com bubble’s burst – remember that almost all internet companies were in their infancy and they were all losing money and living off of borrowed funds – I’m not blaming Bush for this, I’m just saying his tax cuts acted like a catalyst for the bubble to burst – it was inevitable) to Bill Clinton – although we’ll never know what would have happened had he continued the “pay as you go” strategy of the Clinton administration.  Estimates I’ve seen have said that the tax cuts have “robbed” the treasury of upwards of $3 Trillion – which is less than half the deficit accumulated under Bush.

Carrying on two wars while implementing huge tax cuts was a first in our history – and we are seeing the result.  On top of that, the industrial base of this great nation has been moving over seas since the mid-Clinton years and we are also seeing the result of a consumer based economy when the consumers lose their meal ticket – the burgeoning equity in their homes which could be used as an enormous credit card.  The sacrifice of “keep shopping,” which was absurd to me when I heard the words come straight out of the mouth of our 43rd President, will probably go down in history as one of the most ridiculous requests any American President has made to the American public.  So now we are in a sorry state economically, and it’s getting worse by the minute.  When jobs are being lost by the hundreds of thousands (last week almost 700,000) each week, it is like a mushrooming effect in reverse.  This is like a frieght train that is gaining momentum and the more momentum it gains, the harder it’s going to be to stop it, let alone turn it around and get it going in the other direction.

That is exactly why Obama is speaking in superlatives as he’s encouraging Congress to get off their dead a#@*s and pass a stimulus package.  He’s the one in charge and responsible for managing this economy.  Now, keep in mind that the Congress had no idea we were in a recession (they talked that one was impending) until about one year after the Congressional Budget Office officially announced that it had begun in December of 2007 (of course, they announced it around September or October of 2008).  The reason I’m pointing this out is because the government is usually WAY behind the reality that “We the People” are facing in our daily lives.  And what’s happening today is no different.  I believe Obama “gets it” and the Congress doesn’t.  Especially the Republicans.  If you’ve read any of my previous posts you know what I think of the present day Republicans.  (There have been some great Republicans over the years, but most of them are dead and the ones still alive aren’t anywhere near Congress at this point in time – unfortunately)

The real problem, as I see it, is the potential severity of this “downturn.”  I know that Dick Cheney said, “Reagan proved that deficits don’t matter.”  Well, I believe that is the typical short term thinking that has been pervasive in this government for the 30+ years since Nixon.  We’ve discovered deficits do matter, and our deficit is now a major stumbling block to the future prosperity of this nation.  To me, the reality is that the government is going to have to provide a lot more stimulus than the initial package they are debating at present.  Our country essentially needs to be rebuilt, as far as the so-called infrastructure is concerned.  I’m talking about hiways, bridges, schools, sewer systems, transit systems, and more.  We’re talking about over $2 Trillion just for that.  And that doesn’t take into accout the banking system that is in ruins – despite the $300+ Billion thrown recklessly at it by Henry Paulsen as he was headed out the door of the Treasury department.  You’ve heard the statement, “Don’t throw good money after bad,” well, I’m not so sure that isn’t exactly what’s going to happen regarding the banks, even with Obama at the controls of the money.

I was encouraged when they instituted a cap on the amount of compensation the executives could earn if their banks require government “bailout” funds.  But, based on the previous actions of these greedy CEO’s, I just don’t trust them.  If they can find a way around the rules, they will – not a doubt in my mind.  Which is why I believe, with regard to the banks, it’s better to let them fail and have the government come in and take them over.  Now, I know that aint going to happen – if at all possible – because of the panic it would cause, but it just feels to me that we will be throwing good money after bad, unless somehow we can change the mentality of these executives who think for some reason they’re worth hundred’s of times the value of average workers in this country.

My point is that I believe we are facing circumstances which haven’t existed since the Great Depression and this arguing over minor details in Obama’s stimulus package is stupid.  This is also why I believe President Obama is making a huge mistake (I know he promised he would do this in the campaign, but at some point he must understand that enough is enough) by catering to Republicans.  THEY ARE WILLING TO GAMBLE PEOPLE WON’T REMEMBER WHO CAUSED THIS MESS – AND THEY WANT OBAMA TO FAIL.  This is the only chance they have of gaining national power for the forseeable future.  I mean, can you imagine Sarah Palin trying to figure out how to get us out of this mess ( or John McCain)?  But this thing is going to get far worse no matter what happens in the next two weeks – however, SOONER IS BETTER THAN LATER when it comes to the initial legislation intended to slow or stop the downward slide of the economy.

So, if by some miracle of fate,  you’re reading this please call or email your Senator and encourage them to get this thing passed.  I know a lot of people are worried about the huge deficit – but they should have been worried about that years ago.  The Republicans have had a virtual free pass concerning deficit spending – and people kept voting them into office – in fact, there are still enough of them in the Senate to cause problems – and, of course, you will never see the Democratic party marching in lock step like the Republicans – so the Senate will always be a problem with the 60 vote requirement to shut off debate on legislation.  And, once it passes, call or email them again and tell them to let Obama be President so we can judge his administration based on the results of the choices HE makes.  Don’t muddle things up – like they did on this bill with the compromise from the so-called moderate Republicans and Blue Dog Democrats – let the President have a chance to see if his vision will solve the problem.  Their “compromise” is typical Republican BS – less money aimed at ordinary people and more tax cuts for the wealthy.  If we wanted a Republican solution to this mounting problem, we would have voted for Republicans on November 4th!