Tuesday, October 21, 2008

Bernanke Pushing For Another Stimulus Package

In an effort to stem the financial crisis, Federal Reserve Chairman Ben Bernanke is encouraging Congress to pass another stimulus package when they meet next month. To date, President Bush has said he feels as if passing another stimulus bill would be premature, considering we haven’t given the current stimulus measures time to be fully integrated into the economy, but Democrats hope that Bernanke’s blessing will be enough to change his mind. There are several proposals for a new stimulus package on the table right now, but Democrats would like to see this one include funds to address infrastructure and aid states, according to the Associated Press.

If a new stimulus package is passed, it will probably end up being as much as--or even more--than the previous $168 billion stimulus package passed back in February. In addition to the infrastructure and state aid, there could be another tax rebate included, according to the AP. It makes total sense, too, because if we are going to take bad debts off the books for these financial institutions, then why shouldn’t the government give taxpayers money to pay off their debts? Our nation’s infrastructure is badly deteriorating in many areas, so there is a definite need for something to be done; the infrastructure proposal is a good one, assuming that the projects selected are carefully reviewed. In addition to completing badly needed repairs or upgrades, infrastructure work would also create jobs.

But at what point are we going to say enough is enough? How many bailouts or stimulus packages do we have to pass before the economy is going to turn around? Will the economy even react to any of this? These are all tough questions, ones for which the government doesn’t have answers. At this point, they are determined to do whatever it takes to fix the economy and are content to use a trial and error methodology. I don’t know about you, but I would prefer that the government be a little more conservative with my tax dollars than they have been.

We have already committed around a trillion dollars in financial stimulus aid and so far nothing has worked; at some point we need to cut our losses. I think part of the problem is that since, it is an election year, everyone is trying hard not to lose their jobs--instead of thinking, "What is best over the long term?" they are thinking, "What is going to get results over the next two months?" This is obviously not the mindset we want our leaders to have. I sure hope Bush stands up to this push for another stimulus package and instead lets the next administration evaluate its merits. Hopefully by then our leaders will be thinking straight and have our true interests at heart.

1 comment:

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