Why does it seem like fixing the economy is so damn hard?
Because listening to the whinefest that is our current legislature, you'd think it was as difficult as finding the meaning of life. To be clear, I'm annoyed at both the Republicans and Democrats. Well, more annoyed at Republicans, but still.
What does our economy need? Well, we need jobs, and increased demand for goods and services so that consumer and lender confidence is restored to where it should be (though not artificially propped up like it was over the past few years).
Will the economy turn around on its own? Probably. The question is how long will it take, and what will conditions be like until it does? That's what the stimulus package is likely to help. And I do think it will help. The problem is that the Republicans are being idiots, and the Democrats are making it much harder than it should be.
Let's take the Republicans first. They seem to be chanting (over and over again) that nothing will stimulate the economy except tax cuts. And not just any tax cuts, it has to be business tax cuts and income tax cuts (i.e. the progressive income tax, which if cut across the board equally, would disproportionately benefit the rich), because apparently (regressive) payroll taxes don't count. As it says in the link, it is patently absurd to argue this, because even if it were simply a check for poor people who don't pay anything to the government (they do, but let's assume for the sake of argument), it would actually be more likely to stimulate the economy - it's more likely that they'd be forced by their situation to spend it. If the government gives me a tax rebate on my income taxes, what am I going to do with it? I'm gonna save it, because I can afford most things I want already, and I'm concerned about savings. Taken to its logical extreme, do you really think that millionaires will see their lower taxes and say, "wow, now I can go out and spend some money when I just really couldn't afford to before"? Of course not.
There's more Republican idiocy, like claiming that Hoover tried large government spending, but I don't have the patience to deal with that crap. Let's move on to the Democrats. Mostly I'm annoyed at them for the reasons that Andrea is annoyed at them, but also because there's this huge solution sitting right in front of them and they don't see it.
According to the American Society of Civil Engineers, the American infrastructure is failing. They estimate that the government and the private sector need to invest $2.2 trillion over the next five years in order to fix it. The price tag will keep going up if we don't do it now. That kind of massive government spending is exactly what we need to create jobs and demand for goods and services, and the promise that the government will be spending that kind of money over the next half-decade will boost the consumers' confidence in the long term economy, which will boost the short term economy.
Now, Republicans may look at that and scream that nothing but tax cuts for the rich will fix the economy. That's okay. WE STILL NEED TO DO IT. Our country is falling apart at the seams, and something needs to be done about it. I happen to think that it'd be the best thing for our economy right now as well. But they should hop on board for the literal, physical, good of the country. Unless you think that all those rich people who get tax cuts will each take a bridge/levee/whatever and fix it themselves.
I do think that there's an argument to be made for having tax cuts in a stimulus bill as well. And I'm sure that the current stimulus package has some pretty good stuff in it. But it really seems like the struggle to win bipartisan approval is harder than it needs to be, and I worry that because this kind of infrastructure investment isn't part of the stimulus package, it won't actually get done.
What does our economy need? Well, we need jobs, and increased demand for goods and services so that consumer and lender confidence is restored to where it should be (though not artificially propped up like it was over the past few years).
Will the economy turn around on its own? Probably. The question is how long will it take, and what will conditions be like until it does? That's what the stimulus package is likely to help. And I do think it will help. The problem is that the Republicans are being idiots, and the Democrats are making it much harder than it should be.
Let's take the Republicans first. They seem to be chanting (over and over again) that nothing will stimulate the economy except tax cuts. And not just any tax cuts, it has to be business tax cuts and income tax cuts (i.e. the progressive income tax, which if cut across the board equally, would disproportionately benefit the rich), because apparently (regressive) payroll taxes don't count. As it says in the link, it is patently absurd to argue this, because even if it were simply a check for poor people who don't pay anything to the government (they do, but let's assume for the sake of argument), it would actually be more likely to stimulate the economy - it's more likely that they'd be forced by their situation to spend it. If the government gives me a tax rebate on my income taxes, what am I going to do with it? I'm gonna save it, because I can afford most things I want already, and I'm concerned about savings. Taken to its logical extreme, do you really think that millionaires will see their lower taxes and say, "wow, now I can go out and spend some money when I just really couldn't afford to before"? Of course not.
There's more Republican idiocy, like claiming that Hoover tried large government spending, but I don't have the patience to deal with that crap. Let's move on to the Democrats. Mostly I'm annoyed at them for the reasons that Andrea is annoyed at them, but also because there's this huge solution sitting right in front of them and they don't see it.
According to the American Society of Civil Engineers, the American infrastructure is failing. They estimate that the government and the private sector need to invest $2.2 trillion over the next five years in order to fix it. The price tag will keep going up if we don't do it now. That kind of massive government spending is exactly what we need to create jobs and demand for goods and services, and the promise that the government will be spending that kind of money over the next half-decade will boost the consumers' confidence in the long term economy, which will boost the short term economy.
Now, Republicans may look at that and scream that nothing but tax cuts for the rich will fix the economy. That's okay. WE STILL NEED TO DO IT. Our country is falling apart at the seams, and something needs to be done about it. I happen to think that it'd be the best thing for our economy right now as well. But they should hop on board for the literal, physical, good of the country. Unless you think that all those rich people who get tax cuts will each take a bridge/levee/whatever and fix it themselves.
I do think that there's an argument to be made for having tax cuts in a stimulus bill as well. And I'm sure that the current stimulus package has some pretty good stuff in it. But it really seems like the struggle to win bipartisan approval is harder than it needs to be, and I worry that because this kind of infrastructure investment isn't part of the stimulus package, it won't actually get done.