Archive for the ‘Economics’ Category
Here’s an idea for the government bailout program that the vast majority of Americans don’t support. Give us an opt out clause on our taxes for the next 10 years.
Now, I’m not talking about opting out of our taxes. Those of us who don’t support the bailout will still have to pay our taxes as usual. However, we can opt out of our tax dollars being used to fund this ridiculous scam.
If you limit the government’s availability of funds, they can’t be as spendthrift as they have been. If they want to come up with $700 billion to spend on some useless bailout, they will need to get it from some other source than the American taxpayer.
Years ago, this would not have been possible. However, with technology today, this is entirely possible. In fact, we could give taxpayers the ability to opt out of any irresponsible government spending. It would really make it simple for the government to determine how much they can waste on pointless bailouts like the automobile industry bailout. If 60% of Americans don’t support the automobile bailout then they will only have access to 40% of the taxpayer funds.
This would make budgeting for the government much easier! Taxpayers don’t support something, Congress can’t just go spend the money whenever and wherever they want. I suspect that we could balance the budget within 4-5 years and keep it balanced indefinitely with a bailout opt out clause. In fact, I suspect the government would end up with considerable surpluses as government waste would now have a true checks and balance system in place. The total tax dollars collected would be the same, but the ability for Congress to spend would drop considerably.
Now, some might argue that this would create serious problems with because the funding for the bailout is something that is “necessary” to avoid a greater economic downturn or because it is something the public doesn’t understand the importance of. I have two words December 2007.
I’ve been a fan of Steve Forbes since the ’96 Republican primary. While I don’t agree with his flat income tax, I can certainly agree with him that Henry Paulson is “the worst Treasury Secretary in modern times“. It seems like nobody has been willing to point some very harsh fingers at administration officials but not Forbes.
There is this ridiculous notion that we have avoided a much worse financial crisis than it could have been. Certainly if we had buried money in the money holes like Onion News joked about, we’d be in a much worse financial situation. However, we haven’t actually been burying money in real money holes, unless you count the $700 billion bailout we dug ourselves last month.
I have a new idea for a business that is going to make a killing, but I need some investors to get things started. First, we need to hire tens of thousands of people. I’m thinking at least 30,000 people. We’re only going to pay them minimum wage, so we’ll be able to keep costs down. We also need to spend millions of dollars on advertising and make sure we are purchasing materials and services from hundreds of vendors in America.
You might be asking yourself, “What are we going to make?”
That’s the great part! We aren’t going to even make anything! We’ll probably just have each employee purchase a lottery ticket in the states where they are employed. The employees will get to play pool, foosball, air hockey, and basketball while on the job. We’ll have a corporate jet to fly us around. Corporate cars. We’ll have all the amenities necessary to run a large corporation.
Now, you might be asking yourself, “How will I recover my investment?”
By employing so many people and working with so many vendors, us going out of business will cause such a massive “ripple effect” that the federal government will just have to bail us out. We’ll fly to Washington in our private jet and ask them for maybe… I don’t know… Maybe $25 billion. That’s a small price for people to pay for preventing a massive economic meldown, right?
Urban Entrepreneur isn’t some PC term I’m using because I don’t want to talk about the crap life that homeless people have. It’s a marketing term I’m using to talk about the genius folks I see each morning, picking the recyclables out of the trash cans in downtown Los Angeles every day.
I love these folks! I don’t have time to make it to a recycle bin after my juice in the morning, and it certainly isn’t realistic for me to carry my empty juice bottle around with me all day long. At the same time, I don’t want to *not* recycle. I have bags of recyclables at my house. They cover the cost of my monthly haircut, which is hardly enough to live off of, but the folks in downtown are pulling that in just about everyday. They are doing us a favor my collecting our trash and recycling it while helping themselves out with some cash. Proof the entrepreneurial spirit doesn’t die just because you have a cardboard box over your head.
I keep hearing about how the Bush Administration and Congress don’t want the auto industry to fail. They don’t want the banking industry to fail. Yet most entrepreneurs will tell you that they’ve learned more from when they failed than when they succeeded. I’m betting that banks would learn more from failing than from getting bailed out.
There is something humbling about failure. There are so many lessons that come with failure. Perhaps the biggest is that we can recover. We can rebuild. We have it within our capacity to go beyond what we have failed at. That is the biggest life lesson we can ever learn, and I think it would behoove our Congress and President to let some of these businesses learn these valuable lessons.
I can’t tell you how many times I’ve heard people complain about our “greedy” capitalist society. Quite often they are referring to Walmart, the oil industry, and companies who “ship jobs” overseas. There are others, but one of these poses a serious question for capitalism:
Walmart (and hundreds of other retailers) purchase the majority of their products from China. China is a communist country. Are selling and purchasing communist goods acts of capitalism?
Certainly, a cornerstone of capitalism is the free market, but what is it when that “free market” that a capitalist nation purchases from is a communist country? Some might argue that it qualifies as a mixed market economy, but that is a moot point for various reasons and is irrelevant to the question.
People who complain about the “greed” of capitalism will argue that profit driven capitalism is what drives corporations to purchase cheap products from communist countries like China. However, I argue that it is (1) our fear of inflation that drives companies to find cheaper markets like China and that (2) searching for these cheaper products in a communist country is not capitalism.
It’s not like we don’t know China is a communist country. It’s not like we don’t know that the Chinese government filters all money that we send to Chinese banks when our corporations buy products from their factories. We also know that we could, if we wanted to, manufacture these same products in America or another non-communist country. And we also know that our government has given China, a communist nation, favored nation status. With government intervention in support of a communist nation, how can anyone consider the actions of Walmart and other retailers who purchase from a communist country capitalist greed?
Anyone else notice something funny about Bush reasoning:
1. Just months ago, talk about how the economy is strong.
2. Witness the largest bank collapses in the history of the country
3. Tell America we need a $700 billion bailout
If Bush was so incredibly wrong about the economy several months back, why would we take his economic advice and push through an urgent $700 billion bailout?
Especially when he has taken no action in his administration to correct the issues. Like, perhaps firing the head of the SEC as John McCain suggested.
One more thing that is really giving me a good chuckle is everyone pointing fingers at Slick Willy for lowering the requirements for obtaining mortgages. That was over eight years ago. It doesn’t take more than a year (in any state in our entire union) for a bank to foreclose on a home. In most cases, it will be less than 6 months. If these people were so unworthy of being home owners, why were they able to own their homes for the last 7.5+ years?
I’ll give you a hint: It had something to do with the economy and an outhouse. According to RealtyTrac, foreclosures were up 121% over the 2nd quarter of last year and foreclosures are nearly double what they were for the 1st quarter of 2006.
This is about people losing their jobs and their businesses, not being unfit for a mortgage. While there are certainly examples of people unfit for a mortgage getting a home, the massive increase in foreclosures is not because people were unfit. It is because of failed economic policies and failed foreign policy that have sucked trillions of dollars out of the US economy.
One more thing for the W cronies that point the fingers at Slick W. How the hell can you blame people who spend more than they are making? Look at your own administration and the massive deficit this administration has been operating our entire country. The pot is truly calling the kettle black my two-faced friend!