Legislating our way to prosperity?
Feb. 5, 2009
By Steve Mount
Just two weeks into the job, President Barack Obama is hitting something of a stride, despite the best efforts of some.
The mouthpiece of the Republican opposition, Rush Limbaugh, has already indicated, “I want him to fail” — the “him” being Obama. His “damn the torpedoes” philosophy would rather see the economy in ruin than see Obama succeed.
Not every Republican finds kinship with Limbaugh’s divisive opinions. One notable challenger is Republican stalwart Bill Bennett, who said that Limbaugh’s “locution” was not what the nation needed.
However, challenging Limbaugh seems to be for brave-of-heart only. Republican Rep. Phil Gingrey of Georgia made a public apology to Limbaugh after saying that he should “back off” the rhetoric.
As Bennett notes, such obstructionism is not helpful, especially as Obama and his team face the train wreck that is the American and global economies.
I definitely do not want Obama to fail. I want to keep my job and want to see my friends, family and neighbors keep their jobs. The real question is, will the administration’s current plans succeed in doing just that.
Of course, the President does not make law — he can only make coherent and thoughtful suggestions, and then sit back and watch Congress mangle the plan into a chaotic mess, with bits of pork, poison pills and totally unrelated measures added here and there.
The first version crafted by House Democrats was put before the full House and, with the input of House Republicans, pared down in places and expanded in others. Of course, that input into the process didn’t convince a single House Republican to vote for the $819 billion package. But with a sizable Democratic majority, the bill could stand to have no Republican support, and even a handful of Democratic detractors, and still pass.
The House’s plan is now in front of the Senate, where it will get a much closer look. In the Senate, the Republicans have a considerable measure of power. This is good for the nation, because as I’ve written before, it does none of us any good to have bad bills railroaded through, even if there is majority agreement with them.
The sober second look the Senate will take (and, indeed, was designed to take) will end up being something Democrats and Republicans equally like and hate, a sure sign it is a good bill.
The end result must stimulate the economy. It must spend money on things to put people to work, now and in the future; on things that will entice or force banks to begin lending again; on things that will make a real difference.
As of this writing, the bill has a higher price tag than the original House version: $900 billion. The bill is divided into two parts: spending increases and tax cuts.
Welcome to the wonderfully confusing and seemingly paradoxical world of macroeconomics: While spending more, we need to take in less.
The strategy of tax cuts is to give consumers and businesses more money in their pockets, and then hope neither group sits on the newfound funds. If people are out there buying things, orders for new things will increase. If businesses have more orders, they will increase inventory, inventory that will have to be produced by people. Hiring more people will lead to more people working, with more money to spend, and so on.
The strategy of increased spending is more direct — the government funds projects that require businesses and employees to complete, and more projects mean more productive workers. Of course, more workers mean more income tax, hopefully enough to balance out the tax cuts and some of that extra spending.
Case in point: The Census Bureau’s plans to open shop in Williston, a possible boon for many of our recently laid off.
It’s the adage “You’ve got to spend money to make money” writ large.
The outlay of $900 billion scares me in its scope, but the consequences of doing nothing scare me even more. If the president has his way, the bill will be finalized and passed within a couple of weeks. The Congress has time to craft a final bill worthy of passage, worthy of signature. I hope that the lawmakers’ sense of what’s right, and not a Limbaugh-esque sense of spite, takes over and we get a bill that will help us claw our way out of this crisis.
Steve Mount has been a Williston resident since 1996. He is a software engineer at GE Healthcare and is devoted to his family, his country and his Constitution. You can reach Steve at email@example.com or read his blog at http://saltyrain.com/ls.