What could you do with $9,000 dollars a year for three years?

+$1.15T being injected into the Financial market. Washington has now put in $9T to “fix” the economy. This is 89,000+ per household in the US. I am trying to find the statistics but I would think we could have just paid up the mortgages on everyone at risk for far less. But like many of these plans that too would have been rewarding failure by taking from the shrinking majority that pay taxes. So what to do.

I would expect that most people do not have a mortgage over $1500 a month. I looked it up. Based on all homes the number is $927. Yeah… always forget when you live in a big city or suburb. This number is also lowered by folks that have $0 cost for housing (paid off home mortgage). There is a number for homes less than four years old ($1,371). If you remove the 112,000 of these folks that have no mortgage the average rises to $1,392. These numbers are from 2007. So a gut check of $1500 a month works.

So for a cost of 9,000 a household the US government could have covered 6 months of payments on the average house for every person in the country. For nearly 44% of homeowners this would cover 100% of their housing costs. [Because of this cost discrepancy this would actually cost less than the price tag]. Allow this exemption for 5 years at a total of 45,000 per family. That would be about $4.5T.

Wouldn’t this have stopped the rash of foreclosures? That would have stabilized the securities market at created a floor on the price of securities. This would have, in turn, stabilized the banks. It would have also [not sure I like this] allowed people to buy houses off of the open market knowing that the first 5 years of mortgage was covered. This would have stabalized housing prices. With a bit of diligence to manage the out years, this could be constrained so that it does not simply defer the problems. For those without a “mortgage crisis” [93% of all homeowners] this would have created spendable income that would likely be used to pay off debt and/or buy things [stimulus].

In summary, for half of the current cost this could have been solved. I would have been content with 3 years (or 1/3 the cost). If some are worried about non-homeowners being left out, don’t fret. I set you up. These numbers include housing costs by households, which includes renters. I checked and there are actually less households (105mill) then homeowners (123mill – owners of multiple homes). Since we don’t want to reward on both homes, we can assume it will cost even less. So for three years every household would get $9,000…. Question..wouldn’t this in effect be an “across-the-board tax cut” [ewwww… I know those are evil]. And this one would be far bigger then the Bush tax cuts. It is important to note that some suggested this (and for only 2009) and were lambasted for not having a Government-centric solution.
..and so we spend.

The economy continues to worsen and the costs to taxpayers keeps rising. Once again proof that “government experts” spend more time reading books and talking to each other about how much smarter they are then the rest of us; no time living life like the rest of us. They look at macro-economic issues and forget that those numbers are driven by the hard work of every American, every day. They all need a new line of work. One that actually produces something for the country. I believe that will help the economy. We have a chance in 2010 to help that along.


Still not buying the Gov. Jindal story.

I saw Governor Jindal on Meet the Press with David Gregory. Governor Jindal (of Louisiana) is being touted by many Republicans and the answer to Obama or even more crazy as the next Ronald Reagan. I do not buy it. He makes some good points about “strings attached” and long term spending impacts. But he is weak and not nearly emotionally invested in he responses, like Reagan and dare I say Obama. Listen to the interview and watch for these moments. Then think about what he could have said in reply.

He is willing to say the correct things in grand generalities (like Obama) but when asked point blank to defend tax cuts, he wavered and stammered. The facts recited were fundamentally false and Jindal did not know it! He was told that revenues dropped and median incomes did not rise. FALSE! Revenues climbed as did median incomes (in real dollars). It was even a softball. After laying out the invalid numbers he was asked “Do you think these numbers are wrong?”… Come On!

Second, he was asked if stimulus was bad. That Americans were saving and buying down bills, causing the economy to contract. We need the stimulus right? and… nothing!
Answer: Americans are among the most indebted peoples in the world. The government is drunk on deficit spending. The stock market is down 40%+ will no signs of recovery! Do you think people should be spending MORE?! People are smart, people know that in times of uncertainty you need to take a solid assessment of where the money is going and your long term debt. They actually expect their Representatives in Government to do the same. Maybe even read the bill they are signing…then something he actually did say… Throwing more debt and money at the problem only delays the problem… [but missed this]… and forces solving this problem to future generations. That is wholly UNAMERICAN and obfuscating the responsibility granted to us by our electorate!

I hear some of the right words but I do not see the energy and therefore do not believe in Jindal.

Does the media know what Bipartisan means?

It would seem from all of the press coverage of the “stimulus” bill that the term bipartisan is a bit confused. Based on a quick review on dictionary.com, I found that it means “representing, characterized by, or including members from two parties or factions”… odd. Based on the coverage of the vote it would seem to mean “voting for something that democrats vote for” and though that would then create a bipartisan vote it is not the definition.

There were two bipartisan votes yesterday on the “stimulus” and both are getting very little coverage. The first was a vote against the big pork barrel main bill all the Republicans and 11 democrats voted against the bill. By definition that would be bipartisan. The other vote was for the Republican alternative bill which garnered 10 Democrat votes. But I see no coverage of this fact.

I did see Howard Dean on CNBC. He expressed the overarching “new definition” for bipartisan. He words were cleaned up but the basic message was this “we won the election, vote like us or you will keep losing”. No understanding for the bipartisan opposition to the pork in this bill. No value is placed on the constituents that put these Representatives in office. Simply “vote like us”.

This bill is not stimulus. Even the CBO stated that only .12 of every dollar (For the Obamatons that would be “a lot less than half”) will go towards stimulating the economy. So 88% of the money goes to what? Pork…the NEA, Acorn, Alternative Fuels, an ATV trail (that might count on the 12%) and adding more children (with family income over the median and up to age 30) to the government healthcare roles. In other words pet projects for Democrat constituents that got them elected. I know many will say that is why they are there and this is what their constituents expect. I tend to agree. The American people say they want change they say they want things to be different. But in the end they want something for themselves and if it means $9000 for every tax paying family to that they can get some spare change back. They continue to put these people in power.

But Taxes are not going up and the economy is in decline. So this “money” does not exist. How can a project be run on money that does not exist. How can the programs that can’t be paid for now, be increased? It is called “printing money” or “deficit spending”. I thought this was the reason Republicans lost power in 2006. Too much spending and yet we have turned the spicket into a fire hose and left on on full.

I blame us. We put them there. We keep them there. We are rewarding deficit spending. They overspend, we overspend, we are all in debt and the economy is collapsing. So we spend more. What sense does that make. We are the greedy &^*&(%^ that care more about soaking the other guy then preserving the economy for future generations.

Unfortunately, I do not think the spending will stop. This “porkulus” bill will fail to help the economy. It will grow government and government jobs and dependency. And we will ask for more help and another bill will be passed, spending even more money we do not have.

If it were to continue, the interest on these payments will eventually outpace revenue (that would be money taken from most of us…still most for a few more months) and out debtors will realize we are in default. The economy will go deeper into recession (probably depression at this point). But that is ok because this bill “saved jobs”. They will argue that it would have been a lot worse, the media will parrot the sentiment and the spiral continues.

Some will remember the brave 188 that voted in a bipartisan vote to slow this train, they tried to take another course. I hope enough will join will them in the coming months and years to stop the train. The path out of deficit spending is hard and disciplined. It means cutting back not spending more it means putting votes at risk to do what is right. I wonder if enough of them have that much courage.