Congress Bails Out... Governments

You know, the definition of "stimulus spending" sure has changed. It started off as "shovel ready projects" which would employ millions, and all the economic activity that generated would jump-start the economy. Well, that $800 billion effort failed.

Now the concept of "stimulus" has been reduced to extending unemployment benefits (Pelosi called that the "best form" of economic stimulus) and, strangely enough, paying the salaries of government employees.

That's right, in their newest, $26 billion stimulus effort, quite a large chunk of it goes to "save" the jobs of thousands of government employees. Forget the private sector, now the government is focused on stimulating the economy by growing the number of government employees... funded, by the way, with tax increases on the private sector.
http://www.realclearmarkets.com/articles/2010/08/12/congress_decides_to_help_its_own_98622.html

Although private sector employment has declined by 7.8 million since December 2007, on Tuesday President Obama signed into law the Education Jobs and Medicaid Assistance Act, a bill that would spend $10 billion on state and local government workers and $16 billion on state Medicaid payments. Not a penny for the private sector.

The $26 billion will be funded primarily by higher taxes beginning in 2011 on multinational corporations ($10 billion over the next decade) and cuts to the Food Stamps program in 2014 ($12 billion). No one seriously thinks that the Food Stamps cuts will materialize, and Speaker Nancy Pelosi specifically stated in her description of the bill, "House Democrats will work to restore this funding before cuts are implemented."

With this new law, Congress is rewarding states that have been fiscally irresponsible. It should leave states alone to make needed budget cuts and get their finances in order - and repeal the section of the health care law that expands Medicaid, further burdening states.

Well, isn't that special?


It's no surprise, but is IS more than a little disappointing. Despite multiple examples in history, liberal Democrats still think raising taxes on the private sector, borrowing record amounts of money, and having the government engage in "stimulus spending" will actually HELP the economy.

Look, the only thing that will get the economy into a REAL recovery is the private sector. And tax increases, coupled with new regulations and a skyrocketing national debt, are not going to help the private sector generate jobs and economic activity.

But rather than admitting that their Keynesian economic policies are failing (which they are), the Obama administration has decided to double down on them and stay the course. New taxes and "stimulus spending" continue to be implemented, and all this is going to RUIN the economy.

When the tax increases already in the pipeline hit in 2011 and 2012, the economy will likely respond with a sharp nosedive.

Guys, I don't know if the Republicans actually have seen the light. Maybe they're just saying what we want to hear so they can get back in power and be Kings for a while longer. I don't know. What I DO know is that the Democrats, if left in power after the 2010 elections, are going to do their dead-level best to turn our economic potential into little better than Mexico.

And the Republicans are the only viable option. I will hold my nose and vote for them in November, all the while hoping my fears are ungrounded. The Republicans CAN turn things around if put in power this November... the question is, WILL THEY?

I don't know the answer, but it's a chance that has to be taken.