The Stimulus Package

[lonejedi]

I'm very surprised no one has brought this topic up, but with all the debate over the package in the Senate, I thought it would be a worthwhile topic.

So the democrats want to pass the Stimulus package, which is supposed to create jobs by investing money into building roads, and infustructure. It's also supposed to help finance schools and other different areas, as well as give out a few tax cuts. The Republicans want to add a tax cut for home owners. But with the package, come alot of "pork" or unnecessary things. I know of one that is building a golf course worth 3 million dollars.

The biggest thing is, how will this help our economy. Americans are going to be paying for this for a long time. What happens when the money runs out for the stimulus. How will these jobs be able to be paid then? Won't we just lose them yet again? Bill Clinton passed a stimulus worth 18 billion in 1993, obviously inflation changes things, but not THAT MUCH.

 

[Amide]

Congress thinks that the loaned money will circle around the economy, helping everyone's businesses and so on. It's full of spending and some tax cuts, but I just think that people won't really buy American products, so the tax cuts won't have any short turn effects on the economy. The spending in the bill is the dumb part tough, there is billions for education and other programs, and while some are good things, it's unnecessary spending that won't help the economy. In an ECONOMIC STIMULUS bill.

 

[Crimson King]

Well, if failed last time, and it will fail this time, but I can't say I am not happy. If it goes through, being a new homeowner, I will get $7500 as a grant instead (supposedly).

 

[manhunter098]

The entire point behind the stimulus package is to buy time and hope the economy improves in that time, nothing more.

 

[lonejedi]

The entire point behind the stimulus package is to buy time and hope the economy improves in that time, nothing more.

If that's the reason, should we as taxpayers have to pay the costs for that? How is that buying time, when we'll be paying for this plan for years down the road. Why can't we just let the economy fix itself, instead of having to pass these huge spending plans. I don't understand Obama's thinking, he ridiculed Bush for spending so much on the War, yet this stimulus bill is huge. And a lot of the stuff isn't going to help. Seriously, how does Obama think upgrading all these schools to finer technology going to help? Sure, Alot of schools could use newer technology, but how is that going to improve education? The High school that I attend has a lot of good technology, but it's certainly not turning kids who don't try in school, into validvictorians.

Also, did anyone see Obama defend the package on wednesday I believe it was? He seemed on the defensive the total time, and his speech sounded like something from a campaign rally. The guy has to realize, he can't keep making speeches anymore to gather support, he's president now, he actually has to do something that the American people support, and a lot of people don't support paying taxes for years just to hope that this buys time for our economy.

 

[Amide]

I hope the bill doesn't pass, but it will. I recall Obama saying that he isn't going to worry about the enormity of the programs he signs. It'd be funny if it weren't true.

What got cut from bill: http://www.cnn.com/2009/POLITICS/02/07/stimulus.cuts/index.html?eref=rss_topstories

 

[DtJ Jungle]

Because this downward spiral that most sectors of the economy is in has scared the living hell out of most people. Everyone knows the automakers are in shambles but most other sectors are too. I think the one of the few sectors that went up was like technology/computer chip stuff but don't quote me on this.

Obama thinks that with such a big package, it will at least spur the Americans into thinking that the economy will stabilize, and hopefully they will begin to be the little consumers we once were. However, most people will just continue to hold their money until they see an improvement, which wont be helped by this stimulus bill. Overall I'm pretty sure this is doomed to fail. I don't think Obama realizes he can't win people over with his pretty speeches anymore. I understand he is trying to take action, but taking an action where 937 billion dollars are being spent and trying to make it seem ok...is not ok.

I'm pretty sure this is how I'd sum this up.

http://www.youtube.com/watch?v=fqcn_TPu4qQ&feature=channel_page

 

[manhunter098]

If that's the reason, should we as taxpayers have to pay the costs for that? How is that buying time, when we'll be paying for this plan for years down the road. Why can't we just let the economy fix itself, instead of having to pass these huge spending plans. I don't understand Obama's thinking, he ridiculed Bush for spending so much on the War, yet this stimulus bill is huge. And a lot of the stuff isn't going to help. Seriously, how does Obama think upgrading all these schools to finer technology going to help? Sure, Alot of schools could use newer technology, but how is that going to improve education? The High school that I attend has a lot of good technology, but it's certainly not turning kids who don't try in school, into validvictorians.

Also, did anyone see Obama defend the package on wednesday I believe it was? He seemed on the defensive the total time, and his speech sounded like something from a campaign rally. The guy has to realize, he can't keep making speeches anymore to gather support, he's president now, he actually has to do something that the American people support, and a lot of people don't support paying taxes for years just to hope that this buys time for our economy.

The economic crisis is very likely to bankrupt states like Florida and California, which require a lot more money than other states to run, and California is already bankrupt if I recall correctly.

The stimulus package should work to buy time for the economy, but if anything even comes of that its really anybody's guess.

Oh and I dont support the stimulus because I think that there are better ways to solve this problem, Im just stating its purpose. Also, I think the bill might get stopped by the Senate.

 

[Eor]

The bill is not likely to actually be stopped. It might fail in the senate, but that would just result in the Dems changing parts of it so the republicans vote for it. I don't think it's likely it'll fail all together

 

[lonejedi]

See, why can't we just give money away based on incentives? Instead of putting the money into programs which will prob fail, why not use the money like they are using it for the housing rebates? CK (Eric the Red haha) was talking about how he's supposedly going to get money back for being a homeowner, this is how we should be using the money. If there were incentives for people to buy things, people would start spending again. If they gave 5,000 dollars to someone who was buying a new car, look how many people would start buying cars? The automobile industry would jump right back into the market. Sure that's 5,000 dollars, but thats pretty much the equivlent that we are going to have to pay with this stimulus package.

 

[SkylerOcon]

This is just to buy time. And since the US is already so in-debt, this is not a good solution. Why should we spend so much money just so that we can have more time to think of other ways to get money back?

See, why can't we just give money away based on incentives? Instead of putting the money into programs which will prob fail, why not use the money like they are using it for the housing rebates? CK (Eric the Red haha) was talking about how he's supposedly going to get money back for being a homeowner, this is how we should be using the money. If there were incentives for people to buy things, people would start spending again. If they gave 5,000 dollars to someone who was buying a new car, look how many people would start buying cars? The automobile industry would jump right back into the market. Sure that's 5,000 dollars, but thats pretty much the equivlent that we are going to have to pay with this stimulus package.

I've heard of schools offering rewards for getting straight A's, and it encouraged many students to do better. If it worked for them... maybe it'll work for the economy?

 

[aeghrur]

See, why can't we just give money away based on incentives? Instead of putting the money into programs which will prob fail, why not use the money like they are using it for the housing rebates? CK (Eric the Red haha) was talking about how he's supposedly going to get money back for being a homeowner, this is how we should be using the money. If there were incentives for people to buy things, people would start spending again. If they gave 5,000 dollars to someone who was buying a new car, look how many people would start buying cars? The automobile industry would jump right back into the market. Sure that's 5,000 dollars, but thats pretty much the equivlent that we are going to have to pay with this stimulus package.

We're doing this because I believe my Modern Problems teacher explained something like this:
Pork in this situation isn't actually bad. Because you see, if that money goes into the economy at all, like your building a golf course, you still have to hire people to build that golf course. This means your giving people jobs, even from the pork, lol.

Now, this will give people jobs, so it's a trade of value of time for value of money.
On the other hand, if we give people rebates, they'll just see it as another discount, not a job. The difference is what you trade.
In the end, for the car, people are still trading in money for a car. I mean, sure, I could get a car and a 5000 dollar rebate, but what if the car costs 10000 and I only have 7500 dollars? I'd much rather get a job and continue on and stuff... =/

Also, we can't simply wait for the economy to go back to the way it was, because too many people are losing jobs and stuff. =/ Who knows how much worse it could get without some regulation. And this is why regulation is needed... so economies don't crash. Unfortunately, our regulation sucked, lol.

 

[lonejedi]

We're doing this because I believe my Modern Problems teacher explained something like this:
Pork in this situation isn't actually bad. Because you see, if that money goes into the economy at all, like your building a golf course, you still have to hire people to build that golf course. This means your giving people jobs, even from the pork, lol.

Now, this will give people jobs, so it's a trade of value of time for value of money.
On the other hand, if we give people rebates, they'll just see it as another discount, not a job. The difference is what you trade.
In the end, for the car, people are still trading in money for a car. I mean, sure, I could get a car and a 5000 dollar rebate, but what if the car costs 10000 and I only have 7500 dollars? I'd much rather get a job and continue on and stuff... =/

Also, we can't simply wait for the economy to go back to the way it was, because too many people are losing jobs and stuff. =/ Who knows how much worse it could get without some regulation. And this is why regulation is needed... so economies don't crash. Unfortunately, our regulation sucked, lol.

You do realize that the trade off of 5000 dollars for a car, and creating 4 TEMPORARY JOBS, is the same thing right? Except when you give 5,000 for the rebate, you are encouraging spending. You do realize, once the money runs out for the jobs that it's creating, those jobs are just going to be lost again. So say we create those high ways, and we spend all the money in the stimulus bill, then how do we pay those construction guys after we're out of meney hmmmm? We don't, they lose their jobs, and then the cycle starts over!!

 

[Firus]

Yeah, I just don't see the point in this bill. Lonejedi summed it up, we're just creating temporary jobs which are going to be lost too quickly to have done much good. So we're going to make an even larger deficit, we're going to be paying for this for a very long time, and for what? So we can get some jobs temporarily.

I wish the government would just STOP trying to bail the economy out already. I don't think we're doing it any good by trying, even if everyone feels like we have to try.

 

[Lore]

The main problem with all of these things that the government is trying to do is this: Where is the money coming from?

I sincerely hope that they are not planning to just print more money when they need it. All one has to do is look at Germany post-WW1 to see how that will turn out.

The other problem, like Lonejedi said, is the fact that these jobs are only temporary. What will happen when we finish these projects and things get worse after the bills start coming in for the debt we accumulate while spending for these projects?

 

[aeghrur]

You do realize that the trade off of 5000 dollars for a car, and creating 4 TEMPORARY JOBS, is the same thing right? Except when you give 5,000 for the rebate, you are encouraging spending. You do realize, once the money runs out for the jobs that it's creating, those jobs are just going to be lost again. So say we create those high ways, and we spend all the money in the stimulus bill, then how do we pay those construction guys after we're out of meney hmmmm? We don't, they lose their jobs, and then the cycle starts over!!

No, the 5,000 dollars is different because your just buying a new car, which means the money for the car could go to any country, like Japan or South Korea. What's the point then if we're giving people US dollars to put into other countries economies?
The thing is, the stimulus bill is to encourage spending, your right. But people won't spend money if they have no money to spend... So you need to get people jobs, so they will get money, that money goes into the economy, and hopefully it makes a few circles. While you're right that those jobs will be gone afterwards, it's there to get money back into the economic circle. And by the time those jobs are gone, hopefully, HOPEFULLY, the government will learn that we need to take some of the risk off of the banks so their risk/assets ratio could go back to normal. =/

 

[lonejedi]

No, the 5,000 dollars is different because your just buying a new car, which means the money for the car could go to any country, like Japan or South Korea. What's the point then if we're giving people US dollars to put into other countries economies?
The thing is, the stimulus bill is to encourage spending, your right. But people won't spend money if they have no money to spend... So you need to get people jobs, so they will get money, that money goes into the economy, and hopefully it makes a few circles. While you're right that those jobs will be gone afterwards, it's there to get money back into the economic circle. And by the time those jobs are gone, hopefully, HOPEFULLY, the government will learn that we need to take some of the risk off of the banks so their risk/assets ratio could go back to normal. =/

That 5,000 would only be for American Cars, hence the incentive of buying an American Car. And that's pretty sad if we're spending almost 1 trillion dollars on a hope.

 

[lonejedi]

I'm double posting for a reason. Today I just learned about the 75 billion dollar Mortgage relief plan for people who couldn't afford their mortgages. This is getting ridiculous. Not only did we just pass an almost 900 billion stimulus package, now we want to spend more on people who shouldn't have been buying a house in the first place. That means, Im going to pay for it personally through my taxes. Thank You Mr. Obama, Thank You, I just love giving more of my money that I worked for to the government.

 

[Crimson King]

I just got a house and I will actually get like $9500 tax credit. If I had an actual job (long story), I'd spend some money and buy two foreclosure houses with that money. From there, I'd live in the foreclosure houses, pay of the loan, and rent them out until the market is good then sell them off.

 

[Aesir]

They wouldn't have had those mortgages if there was proper over sight by Fannie and Freddie. The government caused this problem, along with happy hour on wallstreet. and it's up the government to fix it. In the long run if it stabilizes the economy it'll be good.

Besides I'd rather spend money keeping people in their homes then spending money bailing out bad businesses.

 

[Pr0phetic]

Ah, our economy is so screwed up they're trying to work as fast as possible to find "hot fixes" to repair it. These economic plans such as reforms for jobs and school and spending on American industry so good on paper, but, after being well thought out, there is still consequences. Now economics is not a guessing game, however, we already have up the white flag screaming "What's to lose?"

 

[Lore]

They wouldn't have had those mortgages if there was proper over sight by Fannie and Freddie. The government caused this problem, along with happy hour on wallstreet. and it's up the government to fix it. In the long run if it stabilizes the economy it'll be good.

Besides I'd rather spend money keeping people in their homes then spending money bailing out bad businesses.

How do you fix the economy by spending more money on mortages that people shouldn't have had in the first place? All this money will do is put us in more debt, but hey, as long as people who leech off the government are in homes, we'll be alright. (Granted, there are a lot of people who AREN'T leeching off the government, but still)

What is with the government and the whole spending more money to save the economy business? I don't wish to have my tax dollars wasted on pointless programs that throw us into even more debt.

As long as the government doesn't do like the government in Atlas Shrugged, I'll be at least a little bit happy. Unfortunately, I can see us heading down that path. (Anyone who hasn't read the book, you should read it. It's quite good reading)

 

[Aesir]

How do you fix the economy by spending more money on mortages that people shouldn't have had in the first place? All this money will do is put us in more debt, but hey, as long as people who leech off the government are in homes, we'll be alright. (Granted, there are a lot of people who AREN'T leeching off the government, but still)

Ok I want to point out something to you that I addressed in the post you just quoted. These people didn't go "I can't afford this but who cares." Companies gave out loans to people who couldn't afford it because of lack of over sight and irresponsibility on the loaners part.

If people start losing their homes the economy is going to get 10x worse.

What is with the government and the whole spending more money to save the economy business? I don't wish to have my tax dollars wasted on pointless programs that throw us into even more debt.

That's why I suggest you put more of that money into keeping people in their homes. If people start losing their homes we all suffer. You don't loan them out to banks because banks horde the money.

As long as the government doesn't do like the government in Atlas Shrugged, I'll be at least a little bit happy. Unfortunately, I can see us heading down that path. (Anyone who hasn't read the book, you should read it. It's quite good reading)

The Government needs to fix the problem they neglected to fix. They started it they need to finish it.

 

[aeghrur]

Here's how fixing mortgages work okay?
Risk:Asset stabilizes for banks due to Government intervention.
Banks start getting a little less scared
They start to loan money.
People can get CREDIT again and our economy will be out of an absolute freeze.

Of course... this is if it works, lol.

Now, here's what happens if we do nothing:
People lose their homes
Economy gets worse
People get apartments, apartment rates go up.
People live on the streets.
More people lose jobs as the defaults are spread throughout the market.
We go into a depression.

Yeah, that kind of sucks. >_> This is what happens when you let Capitalism go for too long, the waves get bigger and we crash harder.

Now, as for reasons of this stimulus package, it's not for looooooooooooong term. It's for getting money into the economy and jumpstarting it, like jumpstarting a car. We may have differing opinions on how to do it, but I hope you do realize it's needed.

 

[Lore]

Ok I want to point out something to you that I addressed in the post you just quoted. These people didn't go "I can't afford this but who cares." Companies gave out loans to people who couldn't afford it because of lack of over sight and irresponsibility on the loaners part.

I meant mainly the people who do buy things with the attitude of "I can't afford this but who cares". There are a surprising amount of people like that. However, I am also aware that there are people who got-for lack of better term-screwed over since the companies gave loans to people who couldn't afford it. I was mainly refering to the first people though. Sorry about that.

Still, I can see your point. In fact, I may even be completely wrong.

The Government needs to fix the problem they neglected to fix. They started it they need to finish it.

That is not what I am talking about at all. Try looking up the book sometime. If not, wiki it.

The basic concept is that in the book they try to start giving everyone jobs and not letting any company work more than their "Fair Share". Which means that if a company needs to sell iron, they would have to divide it up among a lot of delivery companies. If one of those messed up, then the others would have to deliver less, since they would be "Stealing" that other company's work.

That's a very basic summary of how the government goes in it.

Edit: Actually, I need to rethink my stance on this. Thanks for giving me a metaphorical boot in the *** to get me to think I guess. I won't repost until I look into this a little bit more.

 

[Aesir]

I meant mainly the people who do buy things with the attitude of "I can't afford this but who cares". There are a surprising amount of people like that. However, I am also aware that there are people who got-for lack of better term-screwed over since the companies gave loans to people who couldn't afford it. I was mainly refering to the first people though. Sorry about that.

I kind of take issue with that, I have a really hard time believing people remortgage their house saying. "I can't afford this so **** everyone else" attitude. I don't really think that's the case at all, people probably signed on who only understand the basics of the contract. The fact remains if there was proper oversight on these loans these people wouldn't have been loaned to in the first place and we would have avoided this altogether.

 

[lonejedi]

I kind of take issue with that, I have a really hard time believing people remortgage their house saying. "I can't afford this so **** everyone else" attitude. I don't really think that's the case at all, people probably signed on who only understand the basics of the contract. The fact remains if there was proper oversight on these loans these people wouldn't have been loaned to in the first place and we would have avoided this altogether.

You can thank congress for not reforming such companies like Fanny Mae and Freddy Mac when they were warned several times to do so.

 

[Aesir]

You can thank congress for not reforming such companies like Fanny Mae and Freddy Mac when they were warned several times to do so.

I can blame Congress for a lot of things actually. Speaking of blame though, if this plan fails which I hope it doesn't. I'm willing to bet you're going to see a lot of pissed off Americans.