There are so many economic reasons for not doing this that it barely bears pointing it out. Sending every American family $10,000 would be completely ridiculous. The "stimulus checks" that Bush sent out last year held off the current economic crisis for a few months, but it did nothing to solve the underlying problem.
Exactly.
The problem is that everybody is overextended. This has happened before. The market has to correct itself. Credit has to be able to flow.
True again. And think of it this way, in order for the market to "correct" itself, what do most people think "correct itself" involves? Do we think it won't cost Americans for this to "correct itself"? It has to - at some point, it will cost. Whether it's now, or later, it will cost. The REAL question is, who should bear the burden of it? And the REAL answer to that is - the same individuals or corporations who are at fault in the first place. Problem is, nobody agrees on who or what that is.
The government is trying to speed up the recovery process with a minimum of collateral damage. I don't know if it's going to work, but it's an idea. The only other possibility is to just let the whole thing collapse, go through another Great Depression, and then gradually rebuild the economy the old-fashioned way. Nobody wants that.
Nobody may want it, but that sure is one way of the market "correcting itself", which everyone seems to agree needs to happen.
The losses of jobs in the manufacturing sector are completely unsurprising. I know it sounds callous, but this trend has been evident for the past twenty years. This economic crisis has just sped things up.
Yep.
The United States economy has been moving away from a manufacturing economy into more of a service economy. Part of the reason for that is that it's cheaper to make things overseas, other countries have lower corporate taxes, it's still relatively cheap to ship things overseas, tariffs are generally low, etc.
Translation: to keep up with the year-over-year profit margin increases that the investing public demands, companies must find new ways to cut their costs and keep their margin growth steady. At some point, the law of diminishing returns sets in, and you really have nowhere else to go. So you start shipping jobs and production where it's cheaper. Problem solved - margins can once again increase, b/c you've cut costs. But what we've NEVER focused on is the COST of doing that - the long-term damage to our own economy, caused by our increasing demand for better returns in our economy!
In many industries, it's too expensive to produce things in the United States and sell them as cheaply as the American consumer demands. Those jobs are never coming back.
Exactly right - and what we need to realize is there's only 2 basic solutions to the problem. Either be willing to accept higher prices, if it means a better economy with our own stuff produced here, or pay lower prices but be willing to accept that our economy will lose jobs to other countries. Given where we've let our economy get, it's easy to see which choice we - and that means all of us - have made. It's not just the government's fault - none of us were complaining when the economy was booming.
The only way they come back is if America turns into a protectionist economy with high tariffs. Say goodbye to low prices on items if that happens (unless the government sets price controls). Those are all completely anti-capitalist measures, by the way.
Exactly. Our problems are a result, and a natural derivative of, a capitalist economy. We say we want that, yet when it gives us results we don't like, we complain that it's the government's fault. Then, when the government attempts to fix it, we complain b/c we don't like what they're doing. We're really a bunch of whiny, greedy Americans, when it comes down to it.
Still, a "Main Street bailout" (i.e., a welfare check) would help people to spend more. But, spending more doesn't fix anything. Spending more is what got us in this mess to begin with. Spending more is not the answer to this problem. Economists know that. As I said before, they're trying to rebuild the economy without tearing it down completely. Who knows if it will work? It might just delay a complete collapse for a few years. We'll see.[/QUOTE]
Excellent closing points.
