February 6, 2009
The Facts
Several Republicans, including John McCain, are trying to add amendments to the Obama stimulus package that’s just more of what got us into this problem; burdening the consumers. One of the things they are advocating is to allow consumers to deduct the taxes and interest payments on any new auto purchase for two years, and a $15,000 tax credit for the purchase of a new home. Of course, they are also demanding the only thing they really matters to them; the only thing they believe in; tax cuts for wealthy people and corporations - the only citizens they care about (again, trickle-down-economics – TDE).
My View
As I’ve said many times, the real root cause of the current financial disaster is greed; greed built on the backs of consumers. There have been at least two articles published on how the market rose over the past decade on the back of consumers, and when the consumers could consume no more, the market collapsed. Now we have the Republicans wanting to put things in the stimulus bill that does more of the same; encourage consumers to purchase things they probably don’t need and probably can’t afford. And this idea being pushed with nearly 4 million jobs being lost over the past year.
As Steve Pearlstein of the Washington Post said “These tax credits make for great sound-bites and are music to the ears of politically active car salesmen and real estate brokers. Most economists, however, have warned that such credits will have limited impact at a time when house prices are still falling sharply and consumers are worried about their jobs and their shrinking retirement accounts“.
And then there’s their old standby TDE theory. Have these people been living with their heads in the sand and ear plugs in their ears? Evidently! The last bad recession we had was in 1992 after 12 years of Republican Presidents who pushed through their trickle-down-economics theory by slashing taxes for wealthy people and wealthy corporations. And the current recession/depression has come after 8 more years of the same (while, in both cases, dramatically increasing the national debt). And now they want to keep doing the same thing? It didn’t work then and it won’t work now (unless you count making wealthy people & corporations wealthier). So, yea! They either do have their heads and ears covered up, or they really do believe we, the public, are stupid. I tend to believe the latter.
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