Let's rehash the last 2 years of the unbelievably ridiculous spending binge this government has gone on and the impact that it has had on the economy....I will even use ALL Government released Numbers....I just won't spin them quite as nicely as they seem to do….
Timeline:
- Recession officially starts in beginning/middle of 2008 after two consecutive Quarters of Negative GDP Growh.
....Caused by massive amounts of debt being taken on by the private sector...thank-you Mr. Greenspan for your ridiculously bubbleicious monetary policy....and of-course the every American should own their own home and that wonderful slice of the American dream...thank-you Barney Frank and Co.
- 2008....the credit markets start to freeze, stock-market plunges and massive lay-offs take place.
...Now enters Govt's record stimulus package of $814 Billion promoted by the President's most trusted economic advisors...Summers, Romer and Bernstein saying this stimulus would carry a 1.5X multiplier effect and stave off unemployment from rocketing above 8%....and without this massive package we could see unemployment go to 10%! Ouch….according to the stats we hit 10.2% even with this massive spending spree….glad they aren't giving me advice....1.5X mulitiplier effect my pretty little A**
- During this same time the Federal Reserve buys a Trillion bucks of Mortgage-Backed Securities and lowers interest rates all the way down to 0%....don't need to say much here
-Who can forget that Cash-for-Clunkers program and the 1st time Home-buyer tax credit.
....all great ideas to pull demand forward for a one-time injection....but, did anyone think about what would happen after? …that maybe, just maybe sales might screech to a halt or land-slide…no pun intended.
-Unemployment benefits extended to 99 weeks....began at 26 weeks….no comment here
GRAND TOTAL of all these programs costs = almost $3 Trillion in Federal Debt in 2 years time!
Return on that investment = 14.9 million unemployed...a housing market that can't stabilize...auto-sales running at 21% below last year....and a now staggering 9.6% unemployment rate! Oh, but I don’t want to short change this return on investment….so I can't forget the nice equity stake in Goverment Motors, and CitiGoverment Bank....and A.I.G overnment....all top-notch investments of course....that's why the Gov't OutBid all suitors....wait I forgot there weren't any private suitors!!! ....I wonder why?
Never in United States history has any Government been responsible for a larger percentage of total American's income. The Government now tops the scales at accounting for 30% of Americans Income. The highest prior levels were in the '91 recession when this level hit 27% and back in 1975 it peaked at 28%. The most incredible stat is the amount of Transfer payments the Gov't is now responsible for. (Transfer payments is the very kind lingo or PC term for Welfare payments) These have smashed all previous marks at current clip of 18.4% of all INCOME in the U.S.A.! If you live on a small block of 5 houses….that means 1 of those households is FULLY supported by the Government….or YOUR HARD-EARNED TAX DOLLARS!
I just want to make very clear, when the Government says we are headed in the right direction...I want to highlight that it certainly is a direction this great country has never headed in....but right direction? Well I'll leave that for you to decide. We have been told that the economy avoided the Great Depression 2 right? Well at least that's what we are told....I argue that when you look at these numbers we’ve seen a Controlled Depression….only staved off because of the highest Gov’t support of ALL-TIME…The government was only responsible for 16% of all Personal income during the Great Depression….And today this number is almost DOUBLE at 30%....no depression right?
The most difficult part to stomach is that as far as I can see, there is no exit package to wean off of this support…no incentives being taken seriously to hand-off to the private sector....just more talk about another bloody stimulus package and Gov't support...there has to be a time when the Gov’t support level reaches a point of no return…where if they were to reduce the support it would be devastating to the economy….I’m afraid we are going that route....it is defined as unsustainable.
Cash for Clunkers, I must agree with you here I dont think they even thought about the current effect they had on small mom and pop even mid-size companies where all of these clunkers were sitting to get fixed people said F this I am pulling my car from that shop and getting a new car. Who was that program supposed to benefit? GM after the Government already owned it?
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