Matt Kibbe
FreedomWorks
Feb 02, 2009

Top 10 Reasons to Oppose the Stimulus

[click here to download a .pdf of this report for printing]

As with medicine, the first rule of law making should be first, do no harm. The “stimulus” bill fails this test spectacularly. Among so many other reasons to tell your U.S. Representative and Senators in Washington to oppose the stimulus, the Top 10 are:

  1. The Stimulus Will Not Work

    Our history is replete with examples of “stimulus” spending failing to move our economy toward prosperity—Bush just tried it, Ford tried it. Even Christina Romer, Obama’s Chair of the Council of Economic Advisers agrees. Romer wrote in a study, "Our estimates suggest that fiscal actions contributed only moderately to recoveries." The New Deal didn’t end the Great Depression and Obama’s stimulus package won’t end this recession. In fact, two UCLA economists published a study in 2004 finding FDR’s similar New Deal policies prolonged the Great Depression by seven years.

    It fails because you don’t increase economic output by taking a dollar from one person and giving to another. The idea of “stimulus” spending falls for the “ broken window fallacy”—the allure of what is seen versus what is not seen. We will see the jobs created by the government spending. What we won’t see are the jobs lost because consumers have less money to spend because the government got the money its spending from us—the only place it can get money.

  2. The Stimulus follows the same plan that ruined Japan’s economy

    Japan, after a dramatic market crash and a drop in real estate prices responded with government spending not unlike what the US Congress is considering today. In fact, they had 10 stimulus bills between 1992 and 2000, spending billions on infrastructure construction, building bridges, roads, and airports as well as pouring money into biotech and telecommunications. While many countries enjoyed booming economies and falling unemployment during this time, Japan had a lost decade, seeing its unemployment more than double. They spent double the US level of GDP on infrastructure, and now have a lousy economy and have one of the highest national debts in the world.

    After 10 stimulus packages, Japan has gone from having the second biggest economy in the world by a long shot, to being well behind the new number two, China, and is close to falling behind India. We do not want to follow their lead.

  3. The Stimulus is full of Wasteful Projects

    While we were told the stimulus bill would focus on rebuilding America’s infrastructure—mainly the roads and bridges—only 5% of the current bill goes to such projects. The rest of the bill goes to pet projects like:

    • $400,000,000.00 for researching sexually transmitted diseases
    • $200,000,000.00 to force the military to buy environmentally-friendly electric cars
    • $34,000,000.00 to renovate the Department of Commerce headquarters
    • $75,000,000.00 for a program to end smoking which, if successful will bankrupt the State Children's Health Program Democrats are about to pass (SCHIP) that is paid for by cigarette taxes
    • $650,000,000.00 for digital TV coupons
    • $50,000,000.00 for the National Endowment for the Arts

    These programs are just the 2008 version of the “ midnight basketball” program that derailed Bill Clinton’s attempt to ram through a “stimulus” bill in 1992. Despite that bill failing, the economy quickly recovered and the economic boom of the 1990s began.

  4. The Government Can’t Afford the Stimulus

    President Bush pushed the government deep into a $1.2 trillion deficit this year, the third time he has set a record for biggest deficit ever, and President Obama’s stimulus bill follows his lead, piling on more debt. The deficit in 2008 amounted to about 8 percent of GDP. The entire debt is about 35 percent of GDP.

    Even for those who do still believe in Keynesianism, it is important to remember his theory didn’t start with the government already over a trillion dollars in the hole, he was generally operating from balanced budgets.

  5. We Can’t afford the Stimulus

    How much is $825 billion? The Heritage Foundation has calculated that that comes to over $10,000 per American family. To further put that in context, on average, families annually spend:

    • $2,230 on apparel and services
    • $3,595 on health care
    • $4,322 on food at home
    • $11,657 on shelter

  6. The Stimulus is Bigger Than the Economic Output of Most Countries

    If this bill were a country, it’d be the 15th largest country in world, ranking between Australia and Mexico. It is bigger than the economies of Saudi Arabia and Iran combined. In fact, the $875 billion it calls for is more than all the cash in the United States.

  7. Central Planning like the Stimulus Doesn’t Work, Ask the USSR

    If centrally planned government spending on a grand scale produced economic growth, the Soviet Union would have won the Cold War. If government spending on a grand scale produced economic growth we would be in the middle of the Bush Boom right now. It doesn’t. Working, saving, and investing leads to economic output and increases in productivity lead to growth.

    As economics professor Steven Horwitz said, “The stimulus plans assume consumption is the source of growth. It is not. It is the consequence of said growth.”

  8. Remember the $750 Billion Bailout from this Fall?

    It was just a couple months ago when we were told if we would just quickly hand over $750 billion to the Treasury Secretary to bailout his friends on Wall Street, he would make the economy all better. That didn’t work, and neither will an additional $825 billion.

  9. This Money Doesn’t Grow on Trees

    And this has nothing to do with paper money being made of cotton and linen. The only way the government gets money is through taxing, borrowing, or printing—that is, it has to take it out of the economy in order to put it back into the economy. If government borrows the money for the stimulus, then it will either have to print money later or raise taxes to pay it back. If it raises taxes to pay for the stimulus, it will, in effect, be robbing Peter to pay Paul – probably with interest. If it prints the money, inflation decreases the value of the dollar for every American – robbing Paul to pay Paul.

  10. Economists do NOT Agree this is a Good Idea

    No matter how many times supporters of the bill say it, economists do not all agree this bill is a good idea. In fact, hundreds of economists have come out against it, including Noble Laureates, who signed a letter the Cato Institute ran as a full page ad in several major newspapers opposing the stimulus. Still more economists submitted statements to the US House of Representatives opposing the stimulus proposal.

And this only scratches the surface, there are so many more reasons to oppose the stimulus.

Jesus De La Pena
May 18, 2009 - 11:51pm
Alan, I couldn't agree with you more. For all the government that we have to take the money of the ordinary citizen so they can distribute it elsewhere is just not right. I mean, am I to believe that this is an issue that just occured? They didn't see this coming or didn't want to see this coming as it benefited the few too greatly. I remember all these people buying these houses for way too much money and they were getting them. These loans that were being peddled by lenders were being picked up with no regard to the ramifications of these loans. Here I am hanging to my house that I bought in Santee, CA. in 2006 just before I went to Iraq and now I find out I'm only one of the few still trying to hang on around here. When I bought the house it was considered to be a peak time but I bought it thinking that I was going to retire in a city that I couldn't buy a home in. Now I find out that I lost 150K with the house. I like my house but I had to get something bigger as my family got bigger. I had to sell our condo and buy something a little bigger and it resulted in an older house that needs it's TLC on a regular basis. I had my condo for 10 years and thought I had made a profit but I ended up losing it as 60% of it went into this house so I could afford the payment. The other 40% I put away as my wife wanted to go to finish college and our oldest was getting ready to start school as well. I don't mind putting in the work in the house nor do I grip about paying what I'm paying right now, as I set up our loan to a traditional loan. The problem I have is that I took the time to read and reseach these aweful loans that were being offered and could not bring myself to get that sort of loan. So now it turns out that all this these preparations was for nothing. Turns out that my work and planning is going into the pockets of others for thier lack of planning. It's just not right. Ken, You make a valid point as well. I don't mind working and doing what I have to do, whether it be here or abroad but where is all these efforts taking us? This is a great nation that we live in, why can't we be more self-efficiant and dependent of the imports of others? We need to quite looking at saving those dollars on goods from abroad and manufactuer them here in the United States. I know we as a nation can do it. We are sacrificing all of our inovation, creativity and other talents trying to make a buck. We need to pull together as a nation and be self-efficient. With all the money that we have spent in the wars, we need to recoupe these same monies spent to provide these services in the Middle East. I have been in the military for over 20 years and have been deployed overseas over a dozen times. I'm not complaining, in my belief system, God, Family, Country, Service are the guides I live by. What I am complaining about is that I have been overseas all these years and we keep getting sent over there to provide security for these pipelines and the restructure of Iraq. There is something really wrong when the United States is rebuilding and taking care of the people of Iraq when we can't take care of our own. I leave my family knowing that I'm contributing to this fight, but when these kind of things happen it makes me think what am I fighting for. Jan, All the people that I knew that bought these high priced homes, all lost their homes. Yes, ALL of them lost their homes, some because they thought, why pay on a house that's not worth as much as you had first paid for it and some just could not afford the payments anymore. I guess it's up to us to contribute to their mistakes. I really hope that you can hang in there Jan, as well as everyone else the country that I love and would die for has let down with this bail-out nonsense of the wealthy.
Donna Murphy
May 16, 2009 - 7:57pm
To gain perspective on the ten reasons not to support the stimulus package, check out Economics in One Lesson, the Lesson Applied, The Broken Window, by the economist Henry Hazlitt. His article explains that the government may appear to be creating jobs through programs, but it is really preventing long term employment by not allowing a business from becoming established. Right now President Obama and his administration should be focused on policies that allow entrepreneurship to flourish and well run companies to benefit from tax cuts. Companies that are poorly managed will not dig themselves out of the hole no matter how much money government throws at them. As Allan, another blogger states “Governments primary role should be to create a stable environment for business to operate.” A view held by many economists and businessmen, is the premise that the market should be allowed to self correct, even if that means that some major businesses may fail during the process. Another reason not to support this stimulus package is because it does not address the lack of limits on the exportation of American jobs. As blogger Apeguero argues, we should invoke punitive measures against companies that receive stimulus funds and violate this principle. We support this idea with economist Robert Reich’s statement, “There is no good reason why the tax payers should foot the bill, unless the automakers (bailout recipients of the stimulus package) agree to keep their workers employed while they reorganize. Otherwise we are just transferring tax payers’ monies to the shareholders and bondholders.” We do not see much hope in the stimulus package as it redirects money from the people who are supposed to be stimulated. So Kathy, New York City Gal, how are you spending your stimulus money? Have you purchased that new refrigerator yet?
sheldon
May 19, 2009 - 12:40am
Donna you have hit it out of the park here . The idea that the government can create jobs is ludicrous . The government pays its workers through taxes ,it simply does not create buisiness.The government can not sustain its self this way.
LeviA
May 12, 2009 - 1:51am
I wish that government should came up with the most appropriate solution, regardless of what solutions they may have as long as it would be for the betterment of the economy and welfare of the people. They should give greater consideration to problems related to economic instability such as the, high unemployment and inflation rate, market shrinks, bankruptcies, dissolutions and the most typical scenario was the poverty. Layoffs are fairly new to Microsoft, only going through them for the first time a couple of months ago. Last time they gave their employees some generous cash advances. Some people say that Microsoft is to blame, but we all know it's the economy's fault. Some will no doubt need debt relief and a few rounds with Jose Cuervo after Microsoft layoffs. http://personalmoneystore.com/moneyblog/2009/05/05/microsoft-layoffs-hit...
sjj
May 11, 2009 - 9:14pm
Without a doubt, the idea of having to pay more tax dollars to bail out huge corporations from their own failings seems a hard pill to swallow. Many people argue, just as “Kathy” does, that tax relief to the average citizen makes more sense. They are turned off by the thought of increasing our national debt through increased government spending. Although I can sympathies, I also recognize the benefits that can be achieved through implementation of the stimulus package. At a time when American consumers have turned suddenly frugal, any tax cut they receive, they're more likely to save it than spend it. Even if they do go out to purchase a new refrigerator as Kathy suggests, much of the impact will leak out overseas to pay for imports. The idea that our economy would be better served by a tax cut vs public spending just doesn’t hold true. It’s clear that when it comes to economic stimulus, public spending provides much more bang for the buck than tax cuts. Improvements in social welfare inject spendable income into the economy where it will have the largest effect. In turn, this promotes economic growth which benefits both those who pay for social-welfare programs as well as this who receive it. I’m not suggesting there are not valid arguments against the stimulus package, but the argument that a tax cut represents the best solution to the current economic crisis falls well short of the mark.
805mike
May 11, 2009 - 1:05am
My audience, based on the responses to the article, is late 20’s+ with a college education. They also are a homeowner, either gender, in the middle class. In the posting by “Allan Vaitses” in response to Matt Kibbe’s Article “Top 10 Reasons to Oppose the Stimulus”. He is clearly a conservative who believes in the hard working individual by his statement, “If you’re rich and don’t work, the government will give you money. If you are poor and work, the government will take your money.” In another post by “Dawn Whitman” she states that the government should divide up the 875 billion dollars and give every US citizen a check. This post is another reflection of the audience being conservative and believing in the traditional values. My strategy is to address the conservative and liberal views and explain why the stimulus will not work by giving examples and quotes from the different posts. This will give a more equal and balanced argument rather than an attack on my post. We will not end the recession by robbing Peter to pay Paul. The American economy started to fail around 2003 when Greenspan lowered the interest rates way too low. People did not see this as the beginning of an economic crisis, but rather as an opportunity to mortgage their house to the full amount and take out more money than what their house is really worth, while still keeping their mortgage payment the same. The low mortgage rates along with the overinflated value of houses and bank loans(specifically ARM loans) in which borrowers only paid interest on their house started the economic crisis. Yes, the American people are partially to blame for making bad financial decisions. However, shame on the bank and mortgage companies for luring people into mortgaging their house to the full amount on interest only loans. Now, the housing market has crashed, people owe more than what their house is worth, and the ARM loans have now matured and the payments are more than what people can afford. People are losing their homes and not freely spending their money as they were in the late 1990 and early 2000’s. People are more conservative with their money and are not purchasing luxury items, such as new cars, vacations, clothing, eating out, etc. This in turn has had a large effect on our economy. Now the government wants to give a 825 billion dollar stimulus package to wasteful projects. The government plans on borrowing this money from US, the hard working American citizens. The money is not going to stimulate the economy by funding these projects, it will hurt the American citizen who is already struggling to pay their bills. 825 billion would cost each American family approximately $10,000. I fully agree with trying to keep people employed. However don’t fund projects or give bailout money to companies that are only going to continue to make products that people are not going to purchase, because they don’t have the money. People are too busy working trying to make their mortgage payments from the bad ARM loans and overinflated housing market. The government should divide 825 billion, equally among each American family who filed taxes in 2007 and 2008. The money each family would receive could be used to pay off bills, auto payments, and make mortgage payments. Now that would STIMULATE the economy.
Mary_in_CA
May 10, 2009 - 8:37pm
Wow, $825 billion, does our government representatives understand how much that really is? Where is this money going to come from? As middle class Americans we are already struggling, the last thing we need are more taxes. This is how the government is planning on funding their pet projects; the hard earned money from your pocket book. As educated Americans we need to get the word out about the harm that this stimulus package will have on our personal wellbeing and the wellbeing of our grandchildren. We need to make our voices heard by letting the leaders of this nation know how we feel; but more importantly we need to become involved and be part of the solution not just another voice in the crowd. I agree that one possible solution is to invest in ROI (return on investment) opportunities. We need to put the money back into the hands of the middle class Americans so that they can feel confident to spend again.
bewise67
May 8, 2009 - 4:55am
If prosperity is what the government was hoping for in passing the Stimulus Bill, they can stop hoping and start learning from the past. The Unites States should take some been-there-done-that advice from Japan, who according to Matt Kibbe, has gone from having the second biggest economy in the world to almost the fourth. Where did Japan go wrong? It changed its course. Too much government and billions of stimulus bills have placed the country in its worst economic crisis since WWII. AGONZALEZ 46 is right in saying that “the stimulus will not benefit anyone, rather it will generate injustice to everyone.” Isn’t that the case in Japan? Again, let’s learn from history! The idea that “the government should control businesses more and distribute more to the citizens so that individuals have more freedom” as suggested by 01JW is absurd and precisely the reason why countries like Japan are where they are today. Too much government with too much control, it just doesn’t work, it hasn’t worked. I hate to say it but ANGRY, who posted above about Democrats “making promises”, should have a right to be angry but should also get use to more broken promises for the next four years, unless of course the administration is smart enough to look back (and around the world) and realize that those who have been there and have done it, are still paying the consequences, a weak economy. Where will our country be after it’s all said and done?
spencerswarts
April 27, 2009 - 6:25pm
I have heard many people here contend that the democrats (in particular Obama's) strategy of Stimulus and bailout is a bad idea; at best ineffective and at worst an assured road to ruin. The preferred solution - taxcuts. While I do agree that these trillion dollar proposals are based on shaky principles, I think that many people (and politicians) and forgetting what got us into this mess. Relaxed regulation has resulted in everything from billion-dollar Ponzi schemes to financial chaos on wall street. Worse yet, the only discussion is about how to relieve the affects, not fix the root cause. This is akin to taking morphine for a gunshot wound; while it may ease the pain temporarily, it does nothing to affect the underlying cause. Furthermore, articles like Kibbes' do the unfortunate service of painting the Bailout question in a very black-and-white manner. Suggestions like, "previous ones have failed . . . and so will this one" (reason #2 and #8) imply that bailouts are, in principle a flawed idea. In reality, perhaps we can learn from mistakes made in those cases and improve. However, judging from the news, I fear we are neither fixing the root cause nor learning from past mistakes. I think the one thing we can do as American's is to stop shaping this dilemma as Dems vs. the GOP. If Americans are the most productive people on Earth, there is no reason we should feel that we are on the edge of destruction. Let's put our primary focus on preventing this from happening again and continue (or at least try) to be cooperative in repairing our broken institutions.
EdukatedIdeas
April 27, 2009 - 5:33pm
Throughout history our Nations goal has been to promote Life, Liberty and the Pursuit of Happiness, which if further analyzed is directed towards developing financial stability in order to enjoy a life free from government intervention or corrupt law practices, and the ability to have legal rights and to chase whatever goal or career we wish in the Pursuit for financial success. Currently our Nations economic state denies many of these principles and beliefs because of the high un-employment rate in turn leaving very little jobs as well as tremendous debt that can not be re-paid leaving people homeless. Further more the Stimulus Package will attempt to revitalize our economy as well as promote better overall life throughout the world, specifically our great country. “The New Deal” may have failed to revitalize our economy and prolonged the Depression according to UCLA economists; however, to others it greatly encouraged economic growth. Nevertheless the point is to induce economic growth through major organizations and companies, in turn flowing down to the working class which will lead to more jobs as well as a better overall life. As “Ken” pointed out that “the major percentage of this money grab is nothing more than payback and support (PORK) for special interests and campaign supporters of the Democratic party” suggesting that friends and supporters of the Democratic party, possibly particular candidates or Congressmen are using the Stimulus as a way to launder money to the wealthiest and most powerful people in the country. I think we can all agree that money means power, “Earmarks” are bills instituted to promote construction, development of certain products or materials and provide tax dollars to companies, communities or governments who are in need and intend to develop something beneficial for our country or their community. Unfortunately politicians have begun to use these “earmarks” to their benefit by implementing a bill that will promote financial support for a company favored by the politician or congressmen, and then the money is given to the company which returns the favor by “donating” to the politicians’ future election. For example; the $200,000,000.00 “to force the military to buy environmentally-friendly electric cars” may be in good faith to promote a more eco-friendly world and develop jobs for the people manufacturing the cars and technology, however may also be focused towards a specific company which will manufacture the environmentally-friendly cars in turn providing huge success and benefit to the company agreeing to the contract. Nevertheless I unfortunately feel there will always be business conducted through the government; however, this is what leads to our poor economy and untrustworthy government. Politicians need to be elected and chosen on a basis of honesty, trust and knowledge not a media race to see who can say the most catchy lines and look the most professional in order to become the Nations leader. I agree with Jonny when he states that “whether your for the stimulus package, against it or somewhere in between, the discussion needs to be honest and balanced”, this is the optimum argument because it is implemented in good faith. If politicians plan to invest money into our economy the dollar amounts need to be planned accurately in order to emphasize financial growth in specific arenas; not by giving a random million dollar number which may provide benefit to people but still provides substantial economic wealth to the owner or board of directors of the company paid by Americans taxes. This shows that the free market indeed corrodes moral character, because by allowing companies to trade freely in a capitalist market the government no longer enforces or watches over what happens with the billions of tax dollars paid by the American people, and the financial decisions of the firm. “It’s time to start making money the old fashion way” says Allan Vaitses, along with the Friedmans belief on “equality of outcome” if you work hard, trade and focus on creating your own personal financial wealth and success our country will prosper as it has in the past, through hard work.
linzjo
April 27, 2009 - 11:55am
Although frightening to taxpayers, debt can be okay if used to build valuable and time sustaining assets. If the financial output by the government in turn stimulates long term profit, the benefits outweigh the risks. Yes, this stimulus must come in the form of infrastructure that creates long term jobs as opposed to temporary work. That is why the bill is funding $80 billion for modernizing infrastructure. We must also plan for environmental, economic and technological advances to ensure future stability. This is also why the package funds alternative energy production, scientific research and technological advancement. Each aspects of the stimulus package anyone failed to address in their extreme right winged comments. Yes, the success of the stimulus package is not guaranteed, and will depend on its implementation. Of course republicans have a problem with this new package because it limits bonuses for CEO's and senior executives. It attempts to level the playing field by providing family relief and tax cuts to those who are struggling financially. The suggestions about simply giving handouts would be a repeat of Bush's simulus flop. Yes, in all reasonable logic people will use government handouts to pay their bills and pay off debt. But the reality is not so ideal. When people receive "free money" they either save it or buy something frivolous and unhelpful to the economy in the grand scheme. They do not put money towards anything that creates new, time sustaining jobs for the American people.
marlena
November 18, 2009 - 4:26pm

And this has nothing to do with paper money being made of cotton and linen. The only way the government gets money is through taxing, borrowing, or printing—that is, it has to take it out of the economy in order to put it back into the economy. If government borrows the money for the stimulus and ed trial pack, then it will either have to print money later or raise taxes to pay it back. If it raises taxes to pay for the stimulus, it will, in effect, be robbing Peter to pay Paul – probably with interest. If it prints the money, inflation decreases the value of the dollar for every American – robbing Paul to pay Paul.

01jw
April 26, 2009 - 2:36pm
I agree with Gromit that people should have the right to one’s life and property. Politician Rick Santorum and Religion, Philosophy and Public Policy Scholar, Michael Novak believes that the free market does not corrode moral value in people rather than it is the people in the market itself that are the ones to blame. The government officials need to keep each other in check because their morals are seriously flawed when there are so many people who are jobless and they are still trying to bail out companies such as AIG who are using their bailout money to give bonuses to the executives who got them in the mess they are in the first place. In order to fix this economy, the government should control businesses more and distribute more to the citizens so that individuals have more freedom but at the same time have responsibility for their actions and consequences. The government should not have to bail out all more failing corporations because the bailout in the fall did not help the economy and this bailout probably won’t either.
Still Obama hopefull
April 24, 2009 - 9:27pm
We should not settle for second best! " No one ever remembers second place." This is just an the American attitude for everything that we do. As a nation we should DEMAND PREFECTION especially with our current system. The free market is by far the best system because it rewards confidence therefore we must employ better standards as a nation.
wbgyk
April 30, 2009 - 5:54pm
You can get perfection by rushing into things without thinking them through. We, as Americans, don't like to bid our time and observe the worlds around us. If our nation played Chess the way that we conduct our affairs, we would be beaten every time. And to say we have a free market is a joke. Where are the lobbyists for the small businesses and what money can they throw at politicians verses a large corporation? On a side note, why did Micrsoft get sued, but Macintosh was left alone? Microsoft is mostly software, a Mac, the whole kit-and-caboodle. Or economic system is one of the better ones out there, but not the best. I shall diverge no further: to demand perfection without contemplation is asinine.
Still Obama hopefull
April 13, 2009 - 9:04pm
Lorenzo T. wrote - "Even the soundest financial planning comes up a bit short" Although he brings up a valid argument I purpose otherwise... Why should we as a nation settle for anything less than perfect? We elect specific indivuduals to office to ensure our patriotic duties and more importantly to represent US. Personally, when ever I represent myself I NEVER settle for "a bit short," so why should we as a nation settle for anything else?
Lorenzo T.
April 8, 2009 - 3:48am
The current administration is doing their job to provide solution to the financial crisis. Stimulus package, bailout, mortgage refinancing, loan modification, they are just some of those actions that might be the answer to the economic crisis. Even the soundest financial planning comes up a bit short. There are payday loans out there if you need a short term credit solution. To qualify, first you have to be employed, and have an open and active checking account. Look at it this way, they aren't raising their rates like banks are, and they don't check credit – and they also haven't gone running to D.C. for a bailout. So if you need a short term credit solution, look into payday loans in today's economy.
patriot110
March 19, 2009 - 5:33pm
I think the first rule of making law should be to make sure it fits within your constitutional right to do so, THEN that it should do no harm. As far as the mortgage crisis goes, the companies that hold the paper are the ones that participated in the mechanism that made the whole mortgage industry overvalue the homes in the first place. Why make the homeowners pay when it was the mortgage companies that loaned them the money. If I loan a bum on the street I've never seen before a half a million dollars and then I never see him again who is to blame? I had control of the money and that was how I chose to invest it. The responsibility would be mine. Of course the bum would have a moral obligation to repay it and to fulfill their promise but I accepted the risk that he would not. So, the solution is to have the mortgage companies drop the interest part of their payments accepting money on the principle ONLY of all their outstanding loans. If they made crappy for the industry interest only loans then too bad for them. The mortgage companies still cover the payment for the principle on their assets. Consumers would have more money in their pockets which would stimulate the economy greatly.
agonzalez 46
April 27, 2009 - 12:50pm
As Patriot 110 said “The companies that hold the paper are the ones that participated in the mechanism that made the whole mortgage industry overvalue the homes in the first place.” I agree. Mortgage companies were forcing properties to be sold, overpriced, without support of monetary resources, which only lead to inflation! This attempt to achieve equality in home-ownership has destroyed economic freedom, and the force, introduced for good purpose, will end up in the hands of people, such as the mortgage companies, who use it to promote their own interests. This power will further corrupt the mortgage companies. Rather than a stimulus, progressive policies based on productivity and distribution should be in place. If we achieve the goals of growth and equity, companies, even the mortgage companies, will then learn to operate responsibly. The stimulus will not benefit anyone, rather it will generate injustice to everyone, especially the middle class. Citizens of this nation collectively are forced to surrender billions of dollars annually, essentially taking food off our tables, to pay for this corrupted system.
insureguy
February 18, 2009 - 9:20pm
Let's remember, it was Senator Cris Dodd who filabusted the vote to investigate Fanny Mae and Freddie Mac. Thus, our elected Senator caused this mess and the press is protecting his despicable reputation.
insureguy
February 18, 2009 - 8:53pm
I just can't wait for the 2010 midterm elections. The news/press in this nation will suddenly discover how misinformed the voters were as to what "change" meant. Folks, it's the end of the Dems.
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insureguy
February 18, 2009 - 8:57pm
Very well said. I agree 100%. Thanks
insureguy
February 18, 2009 - 9:06pm
The people that voted for "change" had no idea of what that meant. None!! It meant one thing to some and the complete opposite to others. Thus, that left Osama to do whatever he wanted regardless of majority voters opinions. So, we now have the most liberal Senator deciding US policy. May God have mercy on what my ancestors built. One must wonder about how the people of a dying nation feel.
insureguy
February 18, 2009 - 9:11pm
That is a very well thought out comment.
nbdgamer
February 10, 2009 - 12:45pm
Allan man i will have to agree with you 100%. The government anymore is always out for money and more money. The problem with this though is that they spend it on the most ridiculus things possible. i mean for instance Hard Working people like all of us in these comments, all pay our hard earned money to people above us. Like look at the federal employees of the U.S., such as judges and people that have been in the cabinet. America spends so much money on them. Yes, this was good WHEN THEY WERE IN OFFICE, but have any of you guys heard that they still get paid for the rest of their livees even after they retire? This i do not think is fair, even if they did work for the government. Why doesnt the government take the average man and put him in the government and see how it goes. Take someone like me that knows hard work and knows how america really feels. See how much of that money goes to the underclassman and how many jobs become available. i mean come on were paying for retired people we dont even need anymore, and the worst part is its in the millions when the government "trying to pass these stimulus bills" are complaining there broke. Why dont you take thier paychecks for a change and give us a break.
nbdgamer
February 10, 2009 - 12:45pm
Allan man i will have to agree with you 100%. The government anymore is always out for money and more money. The problem with this though is that they spend it on the most ridiculus things possible. i mean for instance Hard Working people like all of us in these comments, all pay our hard earned money to people above us. Like look at the federal employees of the U.S., such as judges and people that have been in the cabinet. America spends so much money on them. Yes, this was good WHEN THEY WERE IN OFFICE, but have any of you guys heard that they still get paid for the rest of their livees even after they retire? This i do not think is fair, even if they did work for the government. Why doesnt the government take the average man and put him in the government and see how it goes. Take someone like me that knows hard work and knows how america really feels. See how much of that money goes to the underclassman and how many jobs become available. i mean come on were paying for retired people we dont even need anymore, and the worst part is its in the millions when the government "trying to pass these stimulus bills" are complaining there broke. Why dont you take thier paychecks for a change and give us a break.
Jesus De La Pena
May 18, 2009 - 11:50pm
Alan, I couldn't agree with you more. For all the government that we have to take the money of the ordinary citizen so they can distribute it elsewhere is just not right. I mean, am I to believe that this is an issue that just occured? They didn't see this coming or didn't want to see this coming as it benefited the few too greatly. I remember all these people buying these houses for way too much money and they were getting them. These loans that were being peddled by lenders were being picked up with no regard to the ramifications of these loans. Here I am hanging to my house that I bought in Santee, CA. in 2006 just before I went to Iraq and now I find out I'm only one of the few still trying to hang on around here. When I bought the house it was considered to be a peak time but I bought it thinking that I was going to retire in a city that I couldn't buy a home in. Now I find out that I lost 150K with the house. I like my house but I had to get something bigger as my family got bigger. I had to sell our condo and buy something a little bigger and it resulted in an older house that needs it's TLC on a regular basis. I had my condo for 10 years and thought I had made a profit but I ended up losing it as 60% of it went into this house so I could afford the payment. The other 40% I put away as my wife wanted to go to finish college and our oldest was getting ready to start school as well. I don't mind putting in the work in the house nor do I grip about paying what I'm paying right now, as I set up our loan to a traditional loan. The problem I have is that I took the time to read and reseach these aweful loans that were being offered and could not bring myself to get that sort of loan. So now it turns out that all this these preparations was for nothing. Turns out that my work and planning is going into the pockets of others for thier lack of planning. It's just not right. Ken, You make a valid point as well. I don't mind working and doing what I have to do, whether it be here or abroad but where is all these efforts taking us? This is a great nation that we live in, why can't we be more self-efficiant and dependent of the imports of others? We need to quite looking at saving those dollars on goods from abroad and manufactuer them here in the United States. I know we as a nation can do it. We are sacrificing all of our inovation, creativity and other talents trying to make a buck. We need to pull together as a nation and be self-efficient. With all the money that we have spent in the wars, we need to recoupe these same monies spent to provide these services in the Middle East. I have been in the military for over 20 years and have been deployed overseas over a dozen times. I'm not complaining, in my belief system, God, Family, Country, Service are the guides I live by. What I am complaining about is that I have been overseas all these years and we keep getting sent over there to provide security for these pipelines and the restructure of Iraq. There is something really wrong when the United States is rebuilding and taking care of the people of Iraq when we can't take care of our own. I leave my family knowing that I'm contributing to this fight, but when these kind of things happen it makes me think what am I fighting for. Jan, All the people that I knew that bought these high priced homes, all lost their homes. Yes, ALL of them lost their homes, some because they thought, why pay on a house that's not worth as much as you had first paid for it and some just could not afford the payments anymore. I guess it's up to us to contribute to their mistakes. I really hope that you can hang in there Jan, as well as everyone else the country that I love and would die for has let down with this bail-out nonsense of the wealthy.
sjj
May 11, 2009 - 9:15pm
Without a doubt, the idea of having to pay more tax dollars to bail out huge corporations from their own failings seems a hard pill to swallow. Many people argue, just as “Kathy” does, that tax relief to the average citizen makes more sense. They are turned off by the thought of increasing our national debt through increased government spending. Although I can sympathies, I also recognize the benefits that can be achieved through implementation of the stimulus package. At a time when American consumers have turned suddenly frugal, any tax cut they receive, they're more likely to save it than spend it. Even if they do go out to purchase a new refrigerator as Kathy suggests, much of the impact will leak out overseas to pay for imports. The idea that our economy would be better served by a tax cut vs public spending just doesn’t hold true. It’s clear that when it comes to economic stimulus, public spending provides much more bang for the buck than tax cuts. Improvements in social welfare inject spendable income into the economy where it will have the largest effect. In turn, this promotes economic growth which benefits both those who pay for social-welfare programs as well as this who receive it. I’m not suggesting there are not valid arguments against the stimulus package, but the argument that a tax cut represents the best solution to the current economic crisis falls well short of the mark.
Mary_in_CA
May 10, 2009 - 8:35pm
Wow, $825 billion, does our government representatives understand how much that really is? Where is this money going to come from? As middle class Americans we are already struggling, the last thing we need are more taxes. This is how the government is planning on funding their pet projects; the hard earned money from your pocket book. As educated Americans we need to get the word out about the harm that this stimulus package will have on our personal wellbeing and the wellbeing of our grandchildren. We need to make our voices heard by letting the leaders of this nation know how we feel; but more importantly we need to become involved and be part of the solution not just another voice in the crowd. I agree that one possible solution is to invest in ROI (return on investment) opportunities. We need to put the money back into the hands of the middle class Americans so that they can feel confident to spend again.
EdukatedIdeas
April 27, 2009 - 5:31pm
Throughout history our Nations goal has been to promote Life, Liberty and the Pursuit of Happiness, which if further analyzed is directed towards developing financial stability in order to enjoy a life free from government intervention or corrupt law practices, and the ability to have legal rights and to chase whatever goal or career we wish in the Pursuit for financial success. Currently our Nations economic state denies many of these principles and beliefs because of the high un-employment rate in turn leaving very little jobs as well as tremendous debt that can not be re-paid leaving people homeless. Further more the Stimulus Package will attempt to revitalize our economy as well as promote better overall life throughout the world, specifically our great country. “The New Deal” may have failed to revitalize our economy and prolonged the Depression according to UCLA economists; however, to others it greatly encouraged economic growth. Nevertheless the point is to induce economic growth through major organizations and companies, in turn flowing down to the working class which will lead to more jobs as well as a better overall life. As “Ken” pointed out that “the major percentage of this money grab is nothing more than payback and support (PORK) for special interests and campaign supporters of the Democratic party” suggesting that friends and supporters of the Democratic party, possibly particular candidates or Congressmen are using the Stimulus as a way to launder money to the wealthiest and most powerful people in the country. I think we can all agree that money means power, “Earmarks” are bills instituted to promote construction, development of certain products or materials and provide tax dollars to companies, communities or governments who are in need and intend to develop something beneficial for our country or their community. Unfortunately politicians have begun to use these “earmarks” to their benefit by implementing a bill that will promote financial support for a company favored by the politician or congressmen, and then the money is given to the company which returns the favor by “donating” to the politicians’ future election. For example; the $200,000,000.00 “to force the military to buy environmentally-friendly electric cars” may be in good faith to promote a more eco-friendly world and develop jobs for the people manufacturing the cars and technology, however may also be focused towards a specific company which will manufacture the environmentally-friendly cars in turn providing huge success and benefit to the company agreeing to the contract. Nevertheless I unfortunately feel there will always be business conducted through the government; however, this is what leads to our poor economy and untrustworthy government. Politicians need to be elected and chosen on a basis of honesty, trust and knowledge not a media race to see who can say the most catchy lines and look the most professional in order to become the Nations leader. I agree with Jonny when he states that “whether your for the stimulus package, against it or somewhere in between, the discussion needs to be honest and balanced”, this is the optimum argument because it is implemented in good faith. If politicians plan to invest money into our economy the dollar amounts need to be planned accurately in order to emphasize financial growth in specific arenas; not by giving a random million dollar number which may provide benefit to people but still provides substantial economic wealth to the owner or board of directors of the company paid by Americans taxes. This shows that the free market indeed corrodes moral character, because by allowing companies to trade freely in a capitalist market the government no longer enforces or watches over what happens with the billions of tax dollars paid by the American people, and the financial decisions of the firm. “It’s time to start making money the old fashion way” says Allan Vaitses, along with the Friedmans belief on “equality of outcome” if you work hard, trade and focus on creating your own personal financial wealth and success our country will prosper as it has in the past, through hard work.
PenPat27
February 20, 2009 - 9:55am
Short and sweet, you are an illiterate Red-neck who has no sense of what proper grammer includes! Read something intelligent and make an opinion of your own first of all. Second of all, Bush and his cronies stole billions of dollars from us for a war in Iraq that has done nothing other than to make companies like Haliburton, Raytheon, and Blackwater Billions of dollars. All paid from said taxpayer. Any government project is supposed to go out to a public bid where the lowest bidder can be appointed the job to save taxpayer dollars. Funny how there was no bidding process with Haliburton though and they were Handed the reconstruction contract of Iraq BEFORE we ever entered! You want to talk about crooks, let's talk about the oil companies who are supposed to pay our government Billions of dollars each year for the right to drill in the Gulf of Mexico and Bush waved that fee. Odd isn't it that he himself as well as Condy Rice have sat on the board for Chevron in their days. I won't argue that a good amount of this stimulus plan is being spent on nonsense items and we could probably cut half of it but, it is still better than the stimulus Bush pushed for to give his campaign financeers one last hurrah and one last big check to say Thank you. That first package was a joke and gave all the wrong people taxpayer dollars. Publically traded companies are NOT part of the PRIVATE sector and the people in charge of them are the biggest thiefs alive. Don't just throw out the random propoganda that you hear on FoxNews and actually learn to make a statement and idea of your own. Please!