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The Poor Deal

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PostPosted: Sun Feb 15, 2009 6:09 am    Post subject: The Poor Deal Reply with quote

The $787 billion stimulus bill (or over $1 trillion when the interest from borrowing is included) is twice the size as a proportion of GDP than FDR's New Deal in 1933 (i.e. 5% compared to 2% of GDP). However, there remains more work to be done, as Obama has stated: "To do the work that needs to be done."

The free market has been a complete failure and without this stimulus, Great Depression II would've been inevitable. The government will now be micromanaging the economy, including through tax and spending policies, to make sure Americans behave appropriately.

It's a foregone conclusion, the Bush tax cuts will be allowed to expire in 2011. Windfall profit taxes will be imposed (e.g. for the oil and health care industries). The gasoline tax will increase substantially. The most productive in society will be taxed at a higher rate, the least productive will receive generous tax credits, and the unproductive will receive more government assistance (this of course, will make society more productive). Government will find many ways to tax and spend.

So, government will be busy reshaping America, although it has accomplished much over the past three weeks. Given enough pork, even moderate Democrats will vote for liberal policies. If the Democrats won just one more Senate seat, they wouldn't need those annoying Republicans to pass everything they want. Most Americans understand, government is not the problem, it's the solution.
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