Publisher's Note: Spend, baby, spend
2008 was worse than 1929 and yet today we have no world-wide depression, no bread lines and no 25 percent unemployment. Itís a miracle.
Fortunately for us it wasnít a one-time act of God, it was governments acting in unity to save our financial systems and rebuild our economy and fast.
Today I fear that that good work is being forgotten and could easily be undone. In fact things are so screwy that many are claiming that President Barack Obama bailed out the banks.
I guess facts are the first things to go in politics.
President George W. Bush bailed out the banks and was right to do it ó as were all the members of Congress who voted for it (including both our Senators).
Letís be frank: Bush and Congress bailed out really really rich people who are likely really big jerks. People we love to hate ó and perhaps rightly so.
Nevertheless, if they went down, we were all going down too. If you could save a child by saving a murderer, would you? Sure. It makes sense to save the banks so small businesses could continue to get loans and people could continue to get mortgages. Was it perfect? Of course not; it was an emergency. But itís what had to be done.
Obama continued Bushís efforts and added a stimulus to the mix ó something Bush would likely have done too (and no less would have been criticized by the Democrats for it). Now, of course, itís Obama who is being called a socialist for doing the only sane thing ó spending money to get the economy going again.
Sadly economics and financial markets arenít science. But in my view the economics of spending more is pretty darn simple. You build roads and people are put to work and that money then goes to build the economy until private businesses start reinvesting here. And this isnít a Democratic Party idea. 2008 Republican presidential candidate Mike Huckabee favored spending a tax rebate on building and repairing roads and bridges. Itís a good way to get the economy going again.
Of course, that takes time. We didnít get into this mess all at once and weíre not going to get out of it with just one government stimulus program. The stimulus didnít fail because the economy isnít back to normal; it succeeded because weíre not in a depression.
But many running for office ó nationally and here ó are running against the stimulus and arguing to roll it back. To what end? Do these politicians want to send us back into recessions or worse? Franklin Delano Roosevelt and the rest of the county learned the hard way when he reduced spending to fight the deficit in the 1930s and the country fell further into depression.
True we have a debt to worry about ó and all stimulus spending should be on a project basis ó but we need to get through the recession first. Itís as if someone is sick with cancer and then gets pneumonia. The cancer needs to be cured, but if we donít get rid of the pneumonia first there will be no one to cure. So spend, Congress, spend ó for now.