Is Spending the Answer?

[Kevin_Kennedy]

This week, Congress and the administration once again showed their lack of economic understanding, as they ramped up spending to record levels. On the surface, maybe it does look to some like the economic crisis is a liquidity problem, that the economy is in trouble because money is not changing hands at the pace it once did in the boom years. They believe that to get back to a booming economy money needs to start changing hands again – and the quickest way to do this is for the federal government to massively expand spending to pump new money into the system. If this is the extent of their understanding, no wonder they call for spending, taxing, bailouts and inflation.

If spending was the solution, we never would have had a problem. During the last eight years, we’ve blown up the size of government and certainly had no want of spending on foreign or domestic policy. The Bush administration increased spending almost 20 percent its first term, and nearly doubled the national debt by the end of the second term. Certainly the case cannot be made that lack of government spending created the problem or can be the solution.

Congressman Ron Paul - Is Spending the Answer? - Texas Straight Talk

 

[PubliusInfinitum]

Nope... It's the problem...

Spending for that which produces value; value which will bring forth additional value is always a great idea... meaning that if I have 10.00 and spend 5 of that to buy something which I can in turn use to regain my 5 dollars plus another 5... well it would be ABSURD TO NOT SPEND...

Of course the Leftist $pendulou$ package, and the 4 TRILLION DOLLAR Leftist OMNIBUS BUDGET, bail-outs and other such nonsense... will not produce value which can be exchanged for value... they will produce only what they're designed to produce... greater political power, greater government control and economic collapse...

With any LUCK... enough people will recognize the subversion that is clearly afoot and congressional majorities will shift on their polar axis... where an American majority in Congress can rescend this insanity ...

 

[wimpy77]

chalk up another for two right winged dumbasses

 

[Kevin_Kennedy]

chalk up another for two right winged dumbasses

I'm not right wing, but if you are unable to discuss this topic intelligently then I don't think the title of "dumbass" applies to any of us that can.

 

[glockmail]

What does Wall Street think of the plan?

 

[auditor0007]

Overspending led to the overvaluing of our assets, namely property. We (everyone) borrowed until we could borrow no more. Now the government thinks the answer is to borrow even more? Sorry, wrong answer.

I don't care what the government does, they're not turning this boondoggle around. It will work itself out eventually on it's own. However, government interference could drag this thing out longer than necessary. It might make things better for a short period of time, but in the long run, we will have to pay for this.

Here's how the economy can repair itself. People stop borrowing money. They save instead of purchasing everything under the sun. Of course, this hurts the economy, but only to a certain point. People still need the necessities and that is enough to keep the economy stable, although hurting badly. As savings increase, people will become more confident that they are secure financially, and they'll actually have extra cash to spend. As they begin spending again, the economy will grow, new jobs will be created helping to further expand the economy.

What nobody wants to face up to is that the solution is one that takes time. It won't happen overnight. For savings to build up, it will take time. But once we reach that point, the returning economy will be much stronger than it has been in a long time.

The lesson we will hopefully learn is that you can't live on borrowed money forever. At some time, it catches up and a correction must be made. The more we borrow, the worse the problem it creates.

 

[mash107]

What does Wall Street think of the plan?

I don't know, and I don't care. It's the morally right thing to do.

Of course, we have people like Obama who thinks it's right to put poor people out of work so we can support banks and those in wall street that made poor decisions.

 

[glockmail]

I don't know, and I don't care. It's the morally right thing to do.

Of course, we have people like Obama who thinks it's right to put poor people out of work so we can support banks and those in wall street that made poor decisions.

Moral to spend our grandchildren's earnings?

 

[mash107]

I don't know, and I don't care. It's the morally right thing to do.

Of course, we have people like Obama who thinks it's right to put poor people out of work so we can support banks and those in wall street that made poor decisions.

Moral to spend our grandchildren's earnings?

I think you misread what I posted... I'm in opposition to spending. And it doesn't just only hurt our grandchildren. It hurts us, directly. When banks loan to government instead of business, that means there's less money out there to create jobs. Credit is finite.

 

[alan1]

chalk up another for two right winged dumbasses

Excellent assessment of your opinion, but not of the topic.
Now, would you care to drop the ad hominems and actually discuss something?

 

[alan1]

Overspending led to the overvaluing of our assets, namely property. We (everyone) borrowed until we could borrow no more. Now the government thinks the answer is to borrow even more? Sorry, wrong answer.

I don't care what the government does, they're not turning this boondoggle around. It will work itself out eventually on it's own. However, government interference could drag this thing out longer than necessary. It might make things better for a short period of time, but in the long run, we will have to pay for this.

Here's how the economy can repair itself. People stop borrowing money. They save instead of purchasing everything under the sun. Of course, this hurts the economy, but only to a certain point. People still need the necessities and that is enough to keep the economy stable, although hurting badly. As savings increase, people will become more confident that they are secure financially, and they'll actually have extra cash to spend. As they begin spending again, the economy will grow, new jobs will be created helping to further expand the economy.

What nobody wants to face up to is that the solution is one that takes time. It won't happen overnight. For savings to build up, it will take time. But once we reach that point, the returning economy will be much stronger than it has been in a long time.

The lesson we will hopefully learn is that you can't live on borrowed money forever. At some time, it catches up and a correction must be made. The more we borrow, the worse the problem it creates.

Not all of us borrowed ourselves into some sort of false sense of wealth. There are some of us that have actually been somewhat responsible.
Other than that, you're pretty much spot on.

 

[Terral]

Hi Kevin:

. . . Is Spending the Answer? - Texas Straight Talk[/url]

NO! :0) All of these liars on the TV are fully focused upon the ‘symptoms’ and not the real ‘cause’ of the current Economic/Mortgage/Foreclosure/Credit/Financial Crisis. The real problem has nothing to do with the banks or credit markets or Wall Street or the Treasury, which is only a smokescreen diversion to take your eye off the real problem. Our U.S. Economy has far too much “Outsourcing of JOBS” and far too many “Foreign Nationals” (legal and illegal) running around loose EVERYWHERE ‘displacing’ U.S. workers from identities and JOBS. The value of your home has nothing to do with how much money the privately-owned FED prints up and hands to the banks!

The value of your home has everything to do with what real consumers ‘are’ willing to pay on any given day. When the legal U.S. workers in your area are ‘displaced’ by Outsourcing, the overuse of 23 Guest Worker Programs, or by one of the MILLIONS of Illegal Alien Foreign Nationals running around, THEN the value of your home goes DOWN in direct proportion to the effectiveness of ‘that displacement process.’ Try to imagine the real value of your home today, IF every single American worker becomes displaced in one way or the other. Well? :0) The only reason that your home is worth more than zero dollars is because the ‘displacement efficiency status’ in your immediate location remains at some value below 100 percent. I saw sign on the side of the road saying, “Gov’t House $69,000.00!!” Okay, so why should I buy your house for 250,000 dollars when I can get three distressed houses for that price? Flood the market with 60,000-dollar houses and the value of your home will depreciate to the same value. Period. Then you are under water on your mortgage and cannot refinance or sell ‘and’ the cycle continues for every other homeowner in the neighborhood. :0)

The steps for fixing the U.S. Economy include:

1. Eliminate Outsourcing of JOBS out of the local job markets.
a. You say, “But then we cannot compete globally.” I say, “Too bad. Learn to compete locally.”

2. Enforce the provisions of the Immigration Reform and Control Act of 1986.
a. Throw every ‘employer’ of Illegal Alien Foreign Nationals into jail and revoke the business license indefinitely.
b. Tattoo every Illegal Alien Foreign National in the U.S. and deport every damned one of them. When they show up within our borders again then off with their heads. End of story.

3. Eliminate all Guest Worker Programs and force U.S. companies to hire “Legal U.S. Workers.”
a. You say, “But then we cannot compete globally . . .” . . . Either hire Americans or expect your company to be handed over to others who will . . .

4. Eliminate off shoring of US corporations to bring every US company under regular taxation guidelines.
a. Cayman Island Corporations should pay twice the taxes as everybody else ‘and’ these people will find away to bring these companies back to America . . .

5. End all bailouts and allow the markets to determine winners and losers.
a. General Motors should go under like AIG and everyone else surviving on treks to the public trough. Bailouts allow poorly-managed companies to continue displacing good companies out of the local markets . . .

6. End 41,000 Lobbyists bribing our U.S. Congressmen and Senators to end massive corruption.
a. The fact that Americans allow this corruption to continue in plain sight speaks to the reasons why Free Enterprise Markets simply do not work. The common denominator in all of these solutions boils down to our elected representatives actually DOING THEIR JOBS, which they have NOT been doing for generations.

7. Last but not least: The most important thing that the USA can do right now to turn things around is to repeal the Federal Reserve Act of 1913 and give the authority to print money back to the U.S. Treasury.
a. Then the Treasury could charge 2 percent on ‘our money’ and begin paying down the out-of-control national debt.

Those looking to the privately-owned FED to solve the problem are actually a large part of the problem, because the owners of the FED (people with names like Rothschild, Warburg, etc. = I cannot post links, so figure it out for yourself = Gary Allen = "None Dare Call It Conspiracy") planned and carried out the 9/11 attacks ‘and’ they are perpetuating your demise right now through this orchestrated U.S./Global Economic Implosion that gathers more momentum with every passing day.

GL,

Terral

 

[auditor0007]

Hi Kevin:

. . . Is Spending the Answer? - Texas Straight Talk[/url]

NO! :0) All of these liars on the TV are fully focused upon the ‘symptoms’ and not the real ‘cause’ of the current Economic/Mortgage/Foreclosure/Credit/Financial Crisis. The real problem has nothing to do with the banks or credit markets or Wall Street or the Treasury, which is only a smokescreen diversion to take your eye off the real problem. Our U.S. Economy has far too much “Outsourcing of JOBS” and far too many “Foreign Nationals” (legal and illegal) running around loose EVERYWHERE ‘displacing’ U.S. workers from identities and JOBS. The value of your home has nothing to do with how much money the privately-owned FED prints up and hands to the banks!

The value of your home has everything to do with what real consumers ‘are’ willing to pay on any given day. When the legal U.S. workers in your area are ‘displaced’ by Outsourcing, the overuse of 23 Guest Worker Programs, or by one of the MILLIONS of Illegal Alien Foreign Nationals running around, THEN the value of your home goes DOWN in direct proportion to the effectiveness of ‘that displacement process.’ Try to imagine the real value of your home today, IF every single American worker becomes displaced in one way or the other. Well? :0) The only reason that your home is worth more than zero dollars is because the ‘displacement efficiency status’ in your immediate location remains at some value below 100 percent. I saw sign on the side of the road saying, “Gov’t House $69,000.00!!” Okay, so why should I buy your house for 250,000 dollars when I can get three distressed houses for that price? Flood the market with 60,000-dollar houses and the value of your home will depreciate to the same value. Period. Then you are under water on your mortgage and cannot refinance or sell ‘and’ the cycle continues for every other homeowner in the neighborhood. :0)

The steps for fixing the U.S. Economy include:

1. Eliminate Outsourcing of JOBS out of the local job markets.
a. You say, “But then we cannot compete globally.” I say, “Too bad. Learn to compete locally.”

2. Enforce the provisions of the Immigration Reform and Control Act of 1986.
a. Throw every ‘employer’ of Illegal Alien Foreign Nationals into jail and revoke the business license indefinitely.
b. Tattoo every Illegal Alien Foreign National in the U.S. and deport every damned one of them. When they show up within our borders again then off with their heads. End of story.

3. Eliminate all Guest Worker Programs and force U.S. companies to hire “Legal U.S. Workers.”
a. You say, “But then we cannot compete globally . . .” . . . Either hire Americans or expect your company to be handed over to others who will . . .

4. Eliminate off shoring of US corporations to bring every US company under regular taxation guidelines.
a. Cayman Island Corporations should pay twice the taxes as everybody else ‘and’ these people will find away to bring these companies back to America . . .

5. End all bailouts and allow the markets to determine winners and losers.
a. General Motors should go under like AIG and everyone else surviving on treks to the public trough. Bailouts allow poorly-managed companies to continue displacing good companies out of the local markets . . .

6. End 41,000 Lobbyists bribing our U.S. Congressmen and Senators to end massive corruption.
a. The fact that Americans allow this corruption to continue in plain sight speaks to the reasons why Free Enterprise Markets simply do not work. The common denominator in all of these solutions boils down to our elected representatives actually DOING THEIR JOBS, which they have NOT been doing for generations.

7. Last but not least: The most important thing that the USA can do right now to turn things around is to repeal the Federal Reserve Act of 1913 and give the authority to print money back to the U.S. Treasury.
a. Then the Treasury could charge 2 percent on ‘our money’ and begin paying down the out-of-control national debt.

Those looking to the privately-owned FED to solve the problem are actually a large part of the problem, because the owners of the FED (people with names like Rothschild, Warburg, etc. = I cannot post links, so figure it out for yourself = Gary Allen = "None Dare Call It Conspiracy") planned and carried out the 9/11 attacks ‘and’ they are perpetuating your demise right now through this orchestrated U.S./Global Economic Implosion that gathers more momentum with every passing day.

GL,

Terral

There is one huge flaw in your argument. We already have more homes/rental properties than we have people to occupy those homes. The real fact is that we overbuilt. Yes, outsourcing of jobs is a part of the problem, but it runs much deeper than that.

If we were to deport all 12 million illegals, how many more housing vacancies would that create? My guess is somehwhere close to another 1 million. Add another 1 million homes or rental properties to the current glut, and guess what will happen to home prices? They'll drop even further. Not only that, but those illegals do contribute to the economy. Yes, they cost us in government services, but our problem right now is the economy. These people spend most of what they earn. Ridding ourselves of their spending would just cost more jobs and more businesses would fail.

The illegals are a small part of our problem. You are looking for a scapegoat to blame the entire crisis on, and you have chosen the illegals. Sorry, but they didn't create this mess. They may have added to it in a small way, but they are not the root cause. And getting rid of them right now, would do more damage than good.

 

[Terral]

Hi Auditor:

There is one huge flaw in your argument. We already have more homes/rental properties than we have people to occupy those homes. The real fact is that we overbuilt. Yes, outsourcing of jobs is a part of the problem, but it runs much deeper than that.

We disagree. Sons and daughters are moving back in with mommy, so the whole family can move back in with Grandma and Grandpa, because Senor Bush (and now Senor Obama) is turning the place into CanAmeriMexico. The ‘contraction’ of the U.S. Economy is actually a carefully orchestrated systemic “IMPLOSION,” which gives everyone (like you) the impression what the housing market is overbuilt. Of course Outsourcing of JOBS is part of the problem and we agree that the real problems facing the U.S. Economy right now run MUCH deeper than that . . .

If we were to deport all 12 million illegals, how many more housing vacancies would that create?

I am sick and tired of people justifying LAWLESSNESS with whining about deporting Illegal Alien Foreign Nationals back to their own countries. Put the people into jail for HIRING Illegal Aliens and these people will find their own way back home. Hire Illegal Alien Foreign Nationals and you take bread out of the mouths of real American children and send money out of the local market here in the USA. Millions of Illegal Aliens in the USA is a large part of the problem ‘and’ the problem is only getting worse, because nobody is ‘enforcing’ the Rule of Law.

My guess is somehwhere close to another 1 million.

Nonsense and your math is irrelevant to any real discussion about “Law Enforcement” and the provisions of the “Immigration Reform and Control Act of 1986.” Hiring Illegal Alien Foreign Nationals IS A CRIME and harboring Illegal Alien Foreign Nationals IS A CRIME. Period. Helping Illegal Alien Foreign Nationals obtain legal status is a felony carrying a five-year sentence, if Senor Obama would simply enforce the Rule of Law. Get rid of the Illegal Aliens and you create 12 to 20 million JOBS, by Congress and the President simply DOING THEIR JOBS. Then our children ‘can’ find JOBS and ‘can’ afford to get their own places ‘and’ your vacancies are all filled with law-abiding Americans. I suppose you are all for allowing another 20 million Illegal Alien Foreign Nationals to moonwalk across the border in the middle of the night to steal more U.S. identities and JOBS, so we can perhaps fill a few more vacancies. Lord-Have-Mercy . . .

Add another 1 million homes or rental properties to the current glut, and guess what will happen to home prices? They'll drop even further.

Justifying LAWLESSNESS is never going to fly with me and that nonsense should never have been eaten up by you either. The current environment of Loyal Bushie Lawlessness IS THE PROBLEM, which includes 12 to 20 Million Illegal Alien Foreign Nationals stealing identities and JOBS from law-abiding Americans. Home prices will continue to slide into the gutter, because ‘displaced’ American workers simply cannot afford to make ‘any’ house payments. Allowing bank robbers to get away with millions might help the economy too, but then we have even more lawlessness that is creating even larger problems. You know things are out of hand when your answer is to allow lawlessness to increase . . .

Not only that, but those illegals do contribute to the economy.

Stop being foolish! Yes, they buy a lot of Chinese crap from Walmart and they buy plenty of junk out of McDonalds, but how many of your customers are Illegal Alien Foreign Nationals not sending every nickel possible back to Mexico? The Illegal Aliens are NOT even supposed to be here ‘and’ they kill an average of 25 Americans EVERY DAY (12 by murder = (can't post links). I suppose you think 25 real Americans dying every damn day from Illegal Alien Foreign National activity here in the good ole USA is helping the economy too. Right? After all, we are only talking about 10,000 real U.S. Citizens killed every year . . .

Yes, they cost us in government services, but our problem right now is the economy.

No. Our problem right now is convincing ‘lawless’ people like you that allowing millions and millions and millions of Illegal Alien Foreign Nationals to overrun the USA is a big part of the cotton-picking problem. The sacrifice of one U.S. Citizen’s life, to have 20 Million Illegal Alien Foreign Nationals running around loose in America, is simply TOO HIGH a price! If you do not understand that simple fact, then you are too far from the “I Am Proud To Be An American” Lifeboat to receive any lifeline from a bible thumper like me. The problems facing our U.S. Economy are directly linked to allowing millions and millions and millions of Illegal Aliens to ‘displace’ U.S. workers from identities and JOBS. Period. One Illegal Alien displaces one U.S. worker who must then go out and ‘displace’ another U.S. worker and another and another and another . . . all the way down the line. I do not believe you have honestly sat down to do the math on just how much damage is done to the local job markets by allowing MILLIONS of Illegal Alien Foreign Nationals to run to and fro . . .

These people spend most of what they earn. Ridding ourselves of their spending would just cost more jobs and more businesses would fail.

Stop kidding yourself! Masons and carpenters and roofers and drywallers and painters are being ‘displaced’ OUT OF JOBS to join 10,000 families going into foreclosure EVERY DAY in the USA ‘and’ that does not even begin to count the people renting apartments! You are talking about ILLEGAL Alien Foreign Nationals that are NOT EVEN SUPPOSED TO BE HERE ‘and’ Americans suffering more and more every damned day, because Senor Obama (like Senor Bush) does NOTHING to ‘enforce’ the Rule Of Law.

The illegals are a small part of our problem.

No. Employers ‘hiring’ from the 20 Million-man Illegal Alien Labor Pool are a LARGE part of the problem facing the USA in the Mortgage/Foreclosure Crisis claiming millions of victims every year. Illegal Aliens represent ‘the’ biggest problem for the mason or laborer that just lost his job and now faces foreclosure as the next stage of ‘his’ problem.

You are looking for a scapegoat to blame the entire crisis on, and you have chosen the illegals.

Stop being silly. You quoted seven things that I listed in Post #12 and ‘you’ cannot write about anything but your love affair with millions and millions and millions of Illegal Aliens who are NOT even supposed to be here. The biggest problem is with those ‘hiring’ the Illegal Aliens ‘and’ the Government Officials looking the other way. The Illegal Aliens ‘can’ do something about ‘their illegal status’ by simply going home, but our elected officials are guilty as sin for allowing all of this Lawlessness to get completely out of hand.

Sorry, but they didn't create this mess.

I am sure the 25 real U.S. Citizens that die today in the USA at the hands of Illegal Aliens will tend to disagree with you. There is nothing in my post about Illegal Aliens causing anything, but they are DEFINITELY a part of the problem.

They may have added to it in a small way, but they are not the root cause. And getting rid of them right now, would do more damage than good.

No and perhaps you will never realize how DEAD WRONG you are on this topic. You are endorsing more lawlessness that will only compound the problem and make things far worse. The Open Borders Lobby cronies in office right now will never begin enforcing the Rule of Law and the U.S. Economy will IMPLODE in the near future no matter what, because the damage is already done. The funny part is that when panic is transformed into pandemonium, then the ‘have not’ coming to take your possessions and perhaps your life will likely be one of these Illegal Alien Foreign Nationals that you are defending right now . . .

GL with that too,

Terral

 

[johnrocks]

I think he's spot on. I also like this.

GOVERNMENT POLICIES LED TO WALL STREET'S RISKY BUSINESS

Many observers blame the current financial crisis on a breakdown of private markets. A more careful look shows that government policy, step by step, led to the current crisis, says Randall G. Holcombe, an economics professor at Florida State University and a Senior Fellow with the James Madison Institute.

Consider:

* Fannie Mae and Freddie Mac were created to help provide mortgages for people who didn't qualify for conventional mortgages; as government-sponsored enterprises (GSE), they rapidly grew to where their debt was nearly half the size of the federal government's debt.
* A related problem began with the Community Reinvestment Act (CRA) of 1977; if lenders wanted to expand their lending, they had to balance their loans to financially secure buyers with loans to buyers who did not meet the conventional mortgage criteria.
* A third factor was easy-money policy adopted by the Federal Reserve Bank early in the decade to mitigate the effects of an incipient recession exacerbated by the after-effects of the September 11, 2001 terrorist attacks; low rates meant lower-cost mortgages, further enabling people to buy houses, however, the increased demand pushed prices up, and many buyers wouldn't have qualified for mortgages except for the relaxed standards.

As long as interest rates remained low and housing prices rose, the problems were hidden, says Holcombe. From 2004 to 2006, however, the Fed boosted the Federal Funds rate to 5.25 percent, pushing up mortgage rates and bringing the artificial housing boom to an end.

GOVERNMENT POLICIES LED TO WALL STREET'S RISKY BUSINESS

 

[Midnight Marauder]

Remember the movie "Cool Hand Luke" where the protagonist was playing poker, and kept doubling down on his bet, saying "kick a buck?"

He was bluffing of course, didn't have the cards and won the hand anyway. Because he ran a confidence game on them. That's why it's called a con and that's why they're called "con men."

"Kick a buck" can work in poker. It simply will not work with the economy. You do really have to have the cards in this particular game. All your charisma, looks and your Harvard mouth won't buy you jack shit except an election.

The Obama is a bright guy, but he doesn't seem to know this little part of the game. He thinks he can emulate FDR, and in fact has said that's what he is trying to do. He said, "What you see in FDR that I hope my team can emulate is, not always getting it right, but in projecting a sense of confidence."

His words, not mine.

He admits he's a con man, knows he's playing the "kick a buck" hand, but oops -- he might actually think it's universal and can work in this game. He's cool enough but he's not cool hand Luke, and it won't work.