I watch the ripples change their size
But never leave the stream
Of warm impermanence
And so the days float through my eyes
But still the days seem the same
And these children that you spit on
As they try to change their worlds
Are immune to your consultations
They're quite aware of what they're goin' through

Wednesday, October 29, 2008

Grab that cash with both hands and make a stash

Okay, so Congress will probably be discussing a new economic stimulous plan in their lame duck session coming up.

First I'll say, this is a really bad idea. We have a lame duck President, and a lame duck session of Congress, and they're going to decide an immensely expensive plan. I don't expect good results.

Second, there are some good ideas out there.

One plan is to extend unemployment insurance. I wholeheartedly endorse this plan. While the official unemployment figures are around 5.6%, the secondary unemployment figure (which includes those who have run out of unemployment, and those who have stopped seeking employment without having a new job in the past year) is running around 11%. True unemployment (which measures how many people are of age and could be employed, but aren't, either in jail, intentional stay at home parents, and a few other factors) runs in the twenty percentile range. So helping out 5.6-11% of people out there, Good Idea(tm).

Another plan is to create a new WPA type program, or to fund infrastructure rehabilitation and expansion. Again, I wholeheartedly support such a plan (although avoiding unnecessary expansion should be an essential part of that, and the bill should focus heavily on the rehabilitation part). This provides jobs, good paying jobs. Those jobs will have a trickle out affect to other jobs. This gets people to work, and gooses the economy directly in a positive way.

There's also a plan being floated, and pushed by a certain Presidential candidate, to buyout troubled loans and refinance them to where they're affordable (fixed rate long-term loans geared to income of the occupants). You may be shocked to hear I'm against this plan. One, well, it pisses me off. I live in a smaller home, a home much farther out than I wanted to be, all to live within my means and get some of what we wanted in a home (mostly being at least .5 an acre of land). I made those trade offs to start in a home that I could afford, and one I hope to be paying off early. It would have been nice to have a 2000 square foot home, with all the fun things like a great room, a separate dinning room, larger bedrooms, a full deck, fireplace, a master bath like one that people think of when they think master bath, etc. I qualified for a $250,000 mortgage (well, actually $450,000 but that was just ridiculous), but didn't feel I could make the monthly payments without being very house poor (right now we're mostly house poor).

I agree that giving money to banks rewarded them for the same behavior, and it is perfectly correct. I believe the $700m bailout law was very weak in enforcement. It should have included stronger provisions for executive pay and stripping "golden parachutes" from most of the employment contracts as a stipulation for accepting money. However, as I've stated before, credit is the spice to the financial market's navigators. The spice must flow.

There's also talk of another direct to tax payer stimulus. Most of the last one went to debt relief (another stimulus to the banks!). Help people get jobs, help them last until they can get a job, help create jobs, and the economy will turn. It won't do it on a dime (well, none of the plans really will). But it will last. And with rebuilding our infrastructure we solve two problems with one bill.

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