Bil Browning

I have doubts about Obama's stimulus package

Filed By Bil Browning | February 25, 2009 12:00 PM | comments

Filed in: Politics
Tags: Barack Obama, economic policy, government bailout, joint session of Congress, stimulus package

I don't understand Obama's stimulus package. I'm not an economist - just an average working class American citizen. While everyone has been praising Obama's address to the joint session of Congress last night, I'm left with more questions than answers. (As I was after seeing Obama's speech in Elkhart earlier this month.)

Maybe it's my level of trust in the government. I feel like America has become a shadow of herself. We lag behind in civil rights for our citizens, our economy is in shambles, we've spent years torturing foreign prisoners, and have spent decades rewarding the rich and castigating the poor and middle class. The American dream of work hard and you'll succeed has become a daydream for those without connections to already established wealth and power. My trust in the government is shot.

As I look at the stimulus package, I have my doubts. The huge bill was signed into law without most legislators even reading the thing. (Which is not unusual!) If they don't know what it involves, how can I? Should we try to take advantage of programs to ditch our variable rate mortgage? Jerame is laid off and I'm on disability. Who would refinance us? Would any of it really help since you know the banking and mortgage industries had a hand in what went into that section? Is "saving" a job the same as stimulating the economy or is it maintaining the status quo? Why is credit the "life blood" of our economy when overspending our resources and borrowing against our future is what got us into this predicament as a nation? Why should we give bajillions of dollars to companies that have already abused what we gave them a few months ago? When will we have to bailout the credit card companies since someone who can't pay their mortgage also can't pay the Visa bill?

What do you think? Can anyone explain this so I can understand it better?

Obama's full address is after the jump.

Remarks of President Barack Obama
As Prepared for Delivery
Address to Joint Session of Congress
Tuesday, February 24th, 2009

Madame Speaker, Mr. Vice President, Members of Congress, and the First Lady of the United States:

I've come here tonight not only to address the distinguished men and women in this great chamber, but to speak frankly and directly to the men and women who sent us here.

I know that for many Americans watching right now, the state of our economy is a concern that rises above all others. And rightly so. If you haven't been personally affected by this recession, you probably know someone who has - a friend; a neighbor; a member of your family. You don't need to hear another list of statistics to know that our economy is in crisis, because you live it every day. It's the worry you wake up with and the source of sleepless nights. It's the job you thought you'd retire from but now have lost; the business you built your dreams upon that's now hanging by a thread; the college acceptance letter your child had to put back in the envelope. The impact of this recession is real, and it is everywhere.

But while our economy may be weakened and our confidence shaken; though we are living through difficult and uncertain times, tonight I want every American to know this:

We will rebuild, we will recover, and the United States of America will emerge stronger than before.

The weight of this crisis will not determine the destiny of this nation. The answers to our problems don't lie beyond our reach. They exist in our laboratories and universities; in our fields and our factories; in the imaginations of our entrepreneurs and the pride of the hardest-working people on Earth. Those qualities that have made America the greatest force of progress and prosperity in human history we still possess in ample measure. What is required now is for this country to pull together, confront boldly the challenges we face, and take responsibility for our future once more.

Now, if we're honest with ourselves, we'll admit that for too long, we have not always met these responsibilities - as a government or as a people. I say this not to lay blame or look backwards, but because it is only by understanding how we arrived at this moment that we'll be able to lift ourselves out of this predicament.

The fact is, our economy did not fall into decline overnight. Nor did all of our problems begin when the housing market collapsed or the stock market sank. We have known for decades that our survival depends on finding new sources of energy. Yet we import more oil today than ever before. The cost of health care eats up more and more of our savings each year, yet we keep delaying reform. Our children will compete for jobs in a global economy that too many of our schools do not prepare them for. And though all these challenges went unsolved, we still managed to spend more money and pile up more debt, both as individuals and through our government, than ever before.

In other words, we have lived through an era where too often, short-term gains were prized over long-term prosperity; where we failed to look beyond the next payment, the next quarter, or the next election. A surplus became an excuse to transfer wealth to the wealthy instead of an opportunity to invest in our future. Regulations were gutted for the sake of a quick profit at the expense of a healthy market. People bought homes they knew they couldn't afford from banks and lenders who pushed those bad loans anyway. And all the while, critical debates and difficult decisions were put off for some other time on some other day.

Well that day of reckoning has arrived, and the time to take charge of our future is here.

Now is the time to act boldly and wisely - to not only revive this economy, but to build a new foundation for lasting prosperity. Now is the time to jumpstart job creation, re-start lending, and invest in areas like energy, health care, and education that will grow our economy, even as we make hard choices to bring our deficit down. That is what my economic agenda is designed to do, and that's what I'd like to talk to you about tonight.

It's an agenda that begins with jobs.

As soon as I took office, I asked this Congress to send me a recovery plan by President's Day that would put people back to work and put money in their pockets. Not because I believe in bigger government - I don't. Not because I'm not mindful of the massive debt we've inherited - I am. I called for action because the failure to do so would have cost more jobs and caused more hardships. In fact, a failure to act would have worsened our long-term deficit by assuring weak economic growth for years. That's why I pushed for quick action. And tonight, I am grateful that this Congress delivered, and pleased to say that the American Recovery and Reinvestment Act is now law.

Over the next two years, this plan will save or create 3.5 million jobs. More than 90% of these jobs will be in the private sector - jobs rebuilding our roads and bridges; constructing wind turbines and solar panels; laying broadband and expanding mass transit.

Because of this plan, there are teachers who can now keep their jobs and educate our kids. Health care professionals can continue caring for our sick. There are 57 police officers who are still on the streets of Minneapolis tonight because this plan prevented the layoffs their department was about to make.

Because of this plan, 95% of the working households in America will receive a tax cut - a tax cut that you will see in your paychecks beginning on April 1st.

Because of this plan, families who are struggling to pay tuition costs will receive a $2,500 tax credit for all four years of college. And Americans who have lost their jobs in this recession will be able to receive extended unemployment benefits and continued health care coverage to help them weather this storm.

I know there are some in this chamber and watching at home who are skeptical of whether this plan will work. I understand that skepticism. Here in Washington, we've all seen how quickly good intentions can turn into broken promises and wasteful spending. And with a plan of this scale comes enormous responsibility to get it right.

That is why I have asked Vice President Biden to lead a tough, unprecedented oversight effort - because nobody messes with Joe. I have told each member of my Cabinet as well as mayors and governors across the country that they will be held accountable by me and the American people for every dollar they spend. I have appointed a proven and aggressive Inspector General to ferret out any and all cases of waste and fraud. And we have created a new website called recovery.gov so that every American can find out how and where their money is being spent.

So the recovery plan we passed is the first step in getting our economy back on track. But it is just the first step. Because even if we manage this plan flawlessly, there will be no real recovery unless we clean up the credit crisis that has severely weakened our financial system.

I want to speak plainly and candidly about this issue tonight, because every American should know that it directly affects you and your family's well-being. You should also know that the money you've deposited in banks across the country is safe; your insurance is secure; and you can rely on the continued operation of our financial system. That is not the source of concern.

The concern is that if we do not re-start lending in this country, our recovery will be choked off before it even begins.

You see, the flow of credit is the lifeblood of our economy. The ability to get a loan is how you finance the purchase of everything from a home to a car to a college education; how stores stock their shelves, farms buy equipment, and businesses make payroll.

But credit has stopped flowing the way it should. Too many bad loans from the housing crisis have made their way onto the books of too many banks. With so much debt and so little confidence, these banks are now fearful of lending out any more money to households, to businesses, or to each other. When there is no lending, families can't afford to buy homes or cars. So businesses are forced to make layoffs. Our economy suffers even more, and credit dries up even further.

That is why this administration is moving swiftly and aggressively to break this destructive cycle, restore confidence, and re-start lending.

We will do so in several ways. First, we are creating a new lending fund that represents the largest effort ever to help provide auto loans, college loans, and small business loans to the consumers and entrepreneurs who keep this economy running.

Second, we have launched a housing plan that will help responsible families facing the threat of foreclosure lower their monthly payments and re-finance their mortgages. It's a plan that won't help speculators or that neighbor down the street who bought a house he could never hope to afford, but it will help millions of Americans who are struggling with declining home values - Americans who will now be able to take advantage of the lower interest rates that this plan has already helped bring about. In fact, the average family who re-finances today can save nearly $2000 per year on their mortgage.

Third, we will act with the full force of the federal government to ensure that the major banks that Americans depend on have enough confidence and enough money to lend even in more difficult times. And when we learn that a major bank has serious problems, we will hold accountable those responsible, force the necessary adjustments, provide the support to clean up their balance sheets, and assure the continuity of a strong, viable institution that can serve our people and our economy.

I understand that on any given day, Wall Street may be more comforted by an approach that gives banks bailouts with no strings attached, and that holds nobody accountable for their reckless decisions. But such an approach won't solve the problem. And our goal is to quicken the day when we re-start lending to the American people and American business and end this crisis once and for all.

I intend to hold these banks fully accountable for the assistance they receive, and this time, they will have to clearly demonstrate how taxpayer dollars result in more lending for the American taxpayer. This time, CEOs won't be able to use taxpayer money to pad their paychecks or buy fancy drapes or disappear on a private jet. Those days are over.

Still, this plan will require significant resources from the federal government - and yes, probably more than we've already set aside. But while the cost of action will be great, I can assure you that the cost of inaction will be far greater, for it could result in an economy that sputters along for not months or years, but perhaps a decade. That would be worse for our deficit, worse for business, worse for you, and worse for the next generation. And I refuse to let that happen.

I understand that when the last administration asked this Congress to provide assistance for struggling banks, Democrats and Republicans alike were infuriated by the mismanagement and results that followed. So were the American taxpayers. So was I.

So I know how unpopular it is to be seen as helping banks right now, especially when everyone is suffering in part from their bad decisions. I promise you - I get it.

But I also know that in a time of crisis, we cannot afford to govern out of anger, or yield to the politics of the moment. My job - our job - is to solve the problem. Our job is to govern with a sense of responsibility. I will not spend a single penny for the purpose of rewarding a single Wall Street executive, but I will do whatever it takes to help the small business that can't pay its workers or the family that has saved and still can't get a mortgage.

That's what this is about. It's not about helping banks - it's about helping people. Because when credit is available again, that young family can finally buy a new home. And then some company will hire workers to build it. And then those workers will have money to spend, and if they can get a loan too, maybe they'll finally buy that car, or open their own business. Investors will return to the market, and American families will see their retirement secured once more. Slowly, but surely, confidence will return, and our economy will recover.

So I ask this Congress to join me in doing whatever proves necessary. Because we cannot consign our nation to an open-ended recession. And to ensure that a crisis of this magnitude never happens again, I ask Congress to move quickly on legislation that will finally reform our outdated regulatory system. It is time to put in place tough, new common-sense rules of the road so that our financial market rewards drive and innovation, and punishes short-cuts and abuse.

The recovery plan and the financial stability plan are the immediate steps we're taking to revive our economy in the short-term. But the only way to fully restore America's economic strength is to make the long-term investments that will lead to new jobs, new industries, and a renewed ability to compete with the rest of the world. The only way this century will be another American century is if we confront at last the price of our dependence on oil and the high cost of health care; the schools that aren't preparing our children and the mountain of debt they stand to inherit. That is our responsibility.

In the next few days, I will submit a budget to Congress. So often, we have come to view these documents as simply numbers on a page or laundry lists of programs. I see this document differently. I see it as a vision for America - as a blueprint for our future.

My budget does not attempt to solve every problem or address every issue. It reflects the stark reality of what we've inherited - a trillion dollar deficit, a financial crisis, and a costly recession.

Given these realities, everyone in this chamber - Democrats and Republicans - will have to sacrifice some worthy priorities for which there are no dollars. And that includes me.

But that does not mean we can afford to ignore our long-term challenges. I reject the view that says our problems will simply take care of themselves; that says government has no role in laying the foundation for our common prosperity.

For history tells a different story. History reminds us that at every moment of economic upheaval and transformation, this nation has responded with bold action and big ideas. In the midst of civil war, we laid railroad tracks from one coast to another that spurred commerce and industry. From the turmoil of the Industrial Revolution came a system of public high schools that prepared our citizens for a new age. In the wake of war and depression, the GI Bill sent a generation to college and created the largest middle-class in history. And a twilight struggle for freedom led to a nation of highways, an American on the moon, and an explosion of technology that still shapes our world.

In each case, government didn't supplant private enterprise; it catalyzed private enterprise. It created the conditions for thousands of entrepreneurs and new businesses to adapt and to thrive.

We are a nation that has seen promise amid peril, and claimed opportunity from ordeal. Now we must be that nation again. That is why, even as it cuts back on the programs we don't need, the budget I submit will invest in the three areas that are absolutely critical to our economic future: energy, health care, and education.

It begins with energy.

We know the country that harnesses the power of clean, renewable energy will lead the 21st century. And yet, it is China that has launched the largest effort in history to make their economy energy efficient. We invented solar technology, but we've fallen behind countries like Germany and Japan in producing it. New plug-in hybrids roll off our assembly lines, but they will run on batteries made in Korea.

Well I do not accept a future where the jobs and industries of tomorrow take root beyond our borders - and I know you don't either. It is time for America to lead again.

Thanks to our recovery plan, we will double this nation's supply of renewable energy in the next three years. We have also made the largest investment in basic research funding in American history - an investment that will spur not only new discoveries in energy, but breakthroughs in medicine, science, and technology.

We will soon lay down thousands of miles of power lines that can carry new energy to cities and towns across this country. And we will put Americans to work making our homes and buildings more efficient so that we can save billions of dollars on our energy bills.

But to truly transform our economy, protect our security, and save our planet from the ravages of climate change, we need to ultimately make clean, renewable energy the profitable kind of energy. So I ask this Congress to send me legislation that places a market-based cap on carbon pollution and drives the production of more renewable energy in America. And to support that innovation, we will invest fifteen billion dollars a year to develop technologies like wind power and solar power; advanced biofuels, clean coal, and more fuel-efficient cars and trucks built right here in America.

As for our auto industry, everyone recognizes that years of bad decision-making and a global recession have pushed our automakers to the brink. We should not, and will not, protect them from their own bad practices. But we are committed to the goal of a re-tooled, re-imagined auto industry that can compete and win. Millions of jobs depend on it. Scores of communities depend on it. And I believe the nation that invented the automobile cannot walk away from it.

None of this will come without cost, nor will it be easy. But this is America. We don't do what's easy. We do what is necessary to move this country forward.

For that same reason, we must also address the crushing cost of health care.

This is a cost that now causes a bankruptcy in America every thirty seconds. By the end of the year, it could cause 1.5 million Americans to lose their homes. In the last eight years, premiums have grown four times faster than wages. And in each of these years, one million more Americans have lost their health insurance. It is one of the major reasons why small businesses close their doors and corporations ship jobs overseas. And it's one of the largest and fastest-growing parts of our budget.

Given these facts, we can no longer afford to put health care reform on hold.

Already, we have done more to advance the cause of health care reform in the last thirty days than we have in the last decade. When it was days old, this Congress passed a law to provide and protect health insurance for eleven million American children whose parents work full-time. Our recovery plan will invest in electronic health records and new technology that will reduce errors, bring down costs, ensure privacy, and save lives. It will launch a new effort to conquer a disease that has touched the life of nearly every American by seeking a cure for cancer in our time. And it makes the largest investment ever in preventive care, because that is one of the best ways to keep our people healthy and our costs under control.

This budget builds on these reforms. It includes an historic commitment to comprehensive health care reform - a down-payment on the principle that we must have quality, affordable health care for every American. It's a commitment that's paid for in part by efficiencies in our system that are long overdue. And it's a step we must take if we hope to bring down our deficit in the years to come.

Now, there will be many different opinions and ideas about how to achieve reform, and that is why I'm bringing together businesses and workers, doctors and health care providers, Democrats and Republicans to begin work on this issue next week.

I suffer no illusions that this will be an easy process. It will be hard. But I also know that nearly a century after Teddy Roosevelt first called for reform, the cost of our health care has weighed down our economy and the conscience of our nation long enough. So let there be no doubt: health care reform cannot wait, it must not wait, and it will not wait another year.

The third challenge we must address is the urgent need to expand the promise of education in America.

In a global economy where the most valuable skill you can sell is your knowledge, a good education is no longer just a pathway to opportunity - it is a pre-requisite.

Right now, three-quarters of the fastest-growing occupations require more than a high school diploma. And yet, just over half of our citizens have that level of education. We have one of the highest high school dropout rates of any industrialized nation. And half of the students who begin college never finish.

This is a prescription for economic decline, because we know the countries that out-teach us today will out-compete us tomorrow. That is why it will be the goal of this administration to ensure that every child has access to a complete and competitive education - from the day they are born to the day they begin a career.

Already, we have made an historic investment in education through the economic recovery plan. We have dramatically expanded early childhood education and will continue to improve its quality, because we know that the most formative learning comes in those first years of life. We have made college affordable for nearly seven million more students. And we have provided the resources necessary to prevent painful cuts and teacher layoffs that would set back our children's progress.

But we know that our schools don't just need more resources. They need more reform. That is why this budget creates new incentives for teacher performance; pathways for advancement, and rewards for success. We'll invest in innovative programs that are already helping schools meet high standards and close achievement gaps. And we will expand our commitment to charter schools.

It is our responsibility as lawmakers and educators to make this system work. But it is the responsibility of every citizen to participate in it. And so tonight, I ask every American to commit to at least one year or more of higher education or career training. This can be community college or a four-year school; vocational training or an apprenticeship. But whatever the training may be, every American will need to get more than a high school diploma. And dropping out of high school is no longer an option. It's not just quitting on yourself, it's quitting on your country - and this country needs and values the talents of every American. That is why we will provide the support necessary for you to complete college and meet a new goal: by 2020, America will once again have the highest proportion of college graduates in the world.

I know that the price of tuition is higher than ever, which is why if you are willing to volunteer in your neighborhood or give back to your community or serve your country, we will make sure that you can afford a higher education. And to encourage a renewed spirit of national service for this and future generations, I ask this Congress to send me the bipartisan legislation that bears the name of Senator Orrin Hatch as well as an American who has never stopped asking what he can do for his country - Senator Edward Kennedy.

These education policies will open the doors of opportunity for our children. But it is up to us to ensure they walk through them. In the end, there is no program or policy that can substitute for a mother or father who will attend those parent/teacher conferences, or help with homework after dinner, or turn off the TV, put away the video games, and read to their child. I speak to you not just as a President, but as a father when I say that responsibility for our children's education must begin at home.

There is, of course, another responsibility we have to our children. And that is the responsibility to ensure that we do not pass on to them a debt they cannot pay. With the deficit we inherited, the cost of the crisis we face, and the long-term challenges we must meet, it has never been more important to ensure that as our economy recovers, we do what it takes to bring this deficit down.

I'm proud that we passed the recovery plan free of earmarks, and I want to pass a budget next year that ensures that each dollar we spend reflects only our most important national priorities.

Yesterday, I held a fiscal summit where I pledged to cut the deficit in half by the end of my first term in office. My administration has also begun to go line by line through the federal budget in order to eliminate wasteful and ineffective programs. As you can imagine, this is a process that will take some time. But we're starting with the biggest lines. We have already identified two trillion dollars in savings over the next decade.

In this budget, we will end education programs that don't work and end direct payments to large agribusinesses that don't need them. We'll eliminate the no-bid contracts that have wasted billions in Iraq, and reform our defense budget so that we're not paying for Cold War-era weapons systems we don't use. We will root out the waste, fraud, and abuse in our Medicare program that doesn't make our seniors any healthier, and we will restore a sense of fairness and balance to our tax code by finally ending the tax breaks for corporations that ship our jobs overseas.

In order to save our children from a future of debt, we will also end the tax breaks for the wealthiest 2% of Americans. But let me perfectly clear, because I know you'll hear the same old claims that rolling back these tax breaks means a massive tax increase on the American people: if your family earns less than $250,000 a year, you will not see your taxes increased a single dime. I repeat: not one single dime. In fact, the recovery plan provides a tax cut - that's right, a tax cut - for 95% of working families. And these checks are on the way.

To preserve our long-term fiscal health, we must also address the growing costs in Medicare and Social Security. Comprehensive health care reform is the best way to strengthen Medicare for years to come. And we must also begin a conversation on how to do the same for Social Security, while creating tax-free universal savings accounts for all Americans.

Finally, because we're also suffering from a deficit of trust, I am committed to restoring a sense of honesty and accountability to our budget. That is why this budget looks ahead ten years and accounts for spending that was left out under the old rules - and for the first time, that includes the full cost of fighting in Iraq and Afghanistan. For seven years, we have been a nation at war. No longer will we hide its price.

We are now carefully reviewing our policies in both wars, and I will soon announce a way forward in Iraq that leaves Iraq to its people and responsibly ends this war.

And with our friends and allies, we will forge a new and comprehensive strategy for Afghanistan and Pakistan to defeat al Qaeda and combat extremism. Because I will not allow terrorists to plot against the American people from safe havens half a world away.

As we meet here tonight, our men and women in uniform stand watch abroad and more are readying to deploy. To each and every one of them, and to the families who bear the quiet burden of their absence, Americans are united in sending one message: we honor your service, we are inspired by your sacrifice, and you have our unyielding support. To relieve the strain on our forces, my budget increases the number of our soldiers and Marines. And to keep our sacred trust with those who serve, we will raise their pay, and give our veterans the expanded health care and benefits that they have earned.

To overcome extremism, we must also be vigilant in upholding the values our troops defend - because there is no force in the world more powerful than the example of America. That is why I have ordered the closing of the detention center at Guantanamo Bay, and will seek swift and certain justice for captured terrorists - because living our values doesn't make us weaker, it makes us safer and it makes us stronger. And that is why I can stand here tonight and say without exception or equivocation that the United States of America does not torture.

In words and deeds, we are showing the world that a new era of engagement has begun. For we know that America cannot meet the threats of this century alone, but the world cannot meet them without America. We cannot shun the negotiating table, nor ignore the foes or forces that could do us harm. We are instead called to move forward with the sense of confidence and candor that serious times demand.

To seek progress toward a secure and lasting peace between Israel and her neighbors, we have appointed an envoy to sustain our effort. To meet the challenges of the 21st century - from terrorism to nuclear proliferation; from pandemic disease to cyber threats to crushing poverty - we will strengthen old alliances, forge new ones, and use all elements of our national power.

And to respond to an economic crisis that is global in scope, we are working with the nations of the G-20 to restore confidence in our financial system, avoid the possibility of escalating protectionism, and spur demand for American goods in markets across the globe. For the world depends on us to have a strong economy, just as our economy depends on the strength of the world's.

As we stand at this crossroads of history, the eyes of all people in all nations are once again upon us - watching to see what we do with this moment; waiting for us to lead.

Those of us gathered here tonight have been called to govern in extraordinary times. It is a tremendous burden, but also a great privilege - one that has been entrusted to few generations of Americans. For in our hands lies the ability to shape our world for good or for ill.

I know that it is easy to lose sight of this truth - to become cynical and doubtful; consumed with the petty and the trivial.

But in my life, I have also learned that hope is found in unlikely places; that inspiration often comes not from those with the most power or celebrity, but from the dreams and aspirations of Americans who are anything but ordinary.

I think about Leonard Abess, the bank president from Miami who reportedly cashed out of his company, took a $60 million bonus, and gave it out to all 399 people who worked for him, plus another 72 who used to work for him. He didn't tell anyone, but when the local newspaper found out, he simply said, ''I knew some of these people since I was 7 years old. I didn't feel right getting the money myself."

I think about Greensburg, Kansas, a town that was completely destroyed by a tornado, but is being rebuilt by its residents as a global example of how clean energy can power an entire community - how it can bring jobs and businesses to a place where piles of bricks and rubble once lay. "The tragedy was terrible," said one of the men who helped them rebuild. "But the folks here know that it also provided an incredible opportunity."

And I think about Ty'Sheoma Bethea, the young girl from that school I visited in Dillon, South Carolina - a place where the ceilings leak, the paint peels off the walls, and they have to stop teaching six times a day because the train barrels by their classroom. She has been told that her school is hopeless, but the other day after class she went to the public library and typed up a letter to the people sitting in this room. She even asked her principal for the money to buy a stamp. The letter asks us for help, and says, "We are just students trying to become lawyers, doctors, congressmen like yourself and one day president, so we can make a change to not just the state of South Carolina but also the world. We are not quitters."

We are not quitters.

These words and these stories tell us something about the spirit of the people who sent us here. They tell us that even in the most trying times, amid the most difficult circumstances, there is a generosity, a resilience, a decency, and a determination that perseveres; a willingness to take responsibility for our future and for posterity.

Their resolve must be our inspiration. Their concerns must be our cause. And we must show them and all our people that we are equal to the task before us.

I know that we haven't agreed on every issue thus far, and there are surely times in the future when we will part ways. But I also know that every American who is sitting here tonight loves this country and wants it to succeed. That must be the starting point for every debate we have in the coming months, and where we return after those debates are done. That is the foundation on which the American people expect us to build common ground.

And if we do - if we come together and lift this nation from the depths of this crisis; if we put our people back to work and restart the engine of our prosperity; if we confront without fear the challenges of our time and summon that enduring spirit of an America that does not quit, then someday years from now our children can tell their children that this was the time when we performed, in the words that are carved into this very chamber, "something worthy to be remembered." Thank you, God Bless you, and may God Bless the United States of America.


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I hear what you are saying - and I can't explain anything but I can comment. I too felt like my trust in government was completely shot - and hopeless. I still feel a little like that, but I think that Obama is doing some things to regain my trust. There's a great essay on restoring our faith in democracy and the steps that Obama would need to take to really engage the listening of the public in an essay called "Capturing Democracy's Surge" in the new book Thinking Big. A bunch of progressive policy think tanks are behind the book, very impressive list of groups. Anyway, after reading this I realized that transparency is what I NEED in my government - and no Obama isn't doing that 100%, but compare whitehouse.gov to how it was during the Bush administration!!!!

You know, that's part of my problem Christopher. Thanks for bringing it up.

The only thing I've got to base my level of trust on right now is confidence in Obama. That's not enough for me. I'm not a blind obedience type. I'm not from Missouri, but I want to shout, "Show me!"

While Obama has done a much better job about government transparency (I really liked the part in last night's speech about including the cost of the wars in the budget finally!), it's not really going to help in this situation. The legislation is already signed; it's moving forward. I have to trust they did the right thing.

But I don't know that they did. In fact, I'm still not sure what they did to make my life and those around me any better?

I was disturbed that this bill passed the House without a single Republican vote in favor. That's a dangerous precedent to set for either party.

Yeah, that's part of what sticks in my craw too, DDog.

Partisan politics trumped what's best for America (or it wouldn't have been a party-line vote). Democrats are just as capable of being partisan as Republicans (even if Obama wants to rise above). Who's to say that this wasn't just a big Democratic FU to get programs and perks they wanted.

Not that I'm opposed to getting some of those things - helping the poor to winterize, helping out those in foreclosure, increasing unemployment and food stamps, better access to family planning, etc. It pissed me off that Bush stripped most of those programs to their core.

But is it symptomatic of the entire bill? How much of it is Democrats including the industries/lobbyists who are close to the bill's authors?

I would say that partisan politics triumphed here, but only in that Republicans refused to vote for any economic recovery bill at all, no matter how much it helped them, their constituent, or, you know, Americans.

And Democrats simply aren't as partisan as Republicans. That's a problem, especially when we're talking about LGBT legislation. We know that every republican will vote against it in most states, but we can't count on every Democrat to vote for it. The same thing happened with this bill in the House.

Bil
I agree. Hoping for a miracle which seems to be his message "Audacity of Hope" in all three of his books. I am glad he didn't quote the bible, Paul on the road to Damascus.
This "stimulous package" is not money that was saved up for a rainy day left over from previous adminstrations. This is borrowed money from China and we are paying them back with worthless Treasury Notes just hot off the printing press, not paying interest on the money borrowed in their currency, the yuan. When they demand their currency or gold, we are screwed, the whole global economy is screwed.

Don't get me started on how we've borrowed so damned much from a communist country with a worse human rights history than even we do lately - a country that isn't exactly our "friend." Idiocy.

But that goes back to my question in the post. Why is credit the lifeblood of the economy? Why do businesses borrow to pay their employees paychecks and then have to pay it back with interest? Why not put their pennies in the bank and save for that rainy day?

Why should I have to have good credit to "finance a college education"? Does anyone else see anything inherently wrong with the word "finance" even being remotely in the sentence when a college education is now expected or demanded for most non-labor jobs? Should you have to mortgage your future just to be able to get a job?

Why should the government borrow untold kajillions from not-so-friendly countries to keep our government running instead of making some needed cuts or finally taking the budget out of the hands of special interest groups and lobbyists? Especially since a lot of it goes to the military instead of helping our own citizens?

Why has borrowing on the future become the status quo?

The answer to the question about credit being the lifeblood of the economy is easy to answer - it's because we've already spent all of OUR money. Seriously. The debt we're incurring now won't be paid off for generations. All of us discussing it will be dead long before it gets paid.

We're broke. The only way to get things moving again is with credit and to hope the economy can grow enough to service the debt and inch forward. But just like homeowners paying just the interest on their mortgage or the credit card holders making the minimum payment because it's all they can afford, we're the definition of broke.

It's going to take much more than "saving or creating" (really, how fucking crass!) 3.5 million jobs to pull us out of this ditch.

The vast majority of the money isn't going to be borrowed from China - it's going to be borrowed from American citizens in the form of US bonds.

The reason we need to borrow in order to spend now is because, as Charles mentioned, there is no budget surplus (hm, wonder how that happened). But money does need to be spent to replace the lost demand in the economy as people lose their jobs and start making cuts in their budgets. When people spend less, people lose jobs, and it's a deadly cycle. The government has to insert itself to create demand.

So saying that budget cuts need to be made (which is the standard Republican line right now because it protects their beloved free market capitalism while not actually solving the problem) is like telling someone who's having a heart attack and being rushed to the hospital that he needs to exercise more and go on a diet. Sure, generally good advice, but not right now!

It's true that we're also borrowing our oil dollars back from places like Saudi Arabia. But to say that most of this money will be borrowed from Americans just isn't true.

China has the most excess dollars to lend, followed by the oil dollars in Saudi Arabia and the like. China will soon, if it hasn't already, be our #1 foreign creditor. But to think a trillion dollars in US Bonds is going to be snapped up by eager Americans just doesn't seem to match reality.

I agree with the rest of what you have to say, though.

Yes, Charles --- and I might add that a synonym for "screwed" as you use it above is most likely to be hyper-inflation, for the US currency definitely and for most Western currencies, probably.

Take comfort ... schadenfreude ... in the notion that maybe Bernie Madoff's retirement fund won't buy any more steak and lobster than yours or mine will. "Not worth a continental" as Americans in a previous era once said ...

I'll try for a few of your questions.

If they don't know what it involves, how can I?

They generally do know what it involves, they just haven't read it. But I'm certain their staffers combed over it and they were briefed on what's in it - that's how the Republicans have been finding the stupidest things in it to disagree with.

If you want to know what's in it, go to recovery.gov, like the good president said on the teevee! :)

Is "saving" a job the same as stimulating the economy or is it maintaining the status quo?

Actually, it's even more stimulating to the economy than creating a job because it happens immediately.

There is no status quo in the economy. Things change every day. That's why they usually talk about dollars of goods and services produced in economic indicators instead of the dollars that exist - the economy is a giant machine that creates and destroys things at the same time, and the only meaningful measure of that is speed and direction.

Preventing someone from getting laid off means that she can continue buying essential goods and services, which prevents others from being laid off.

Why is credit the "life blood" of our economy when overspending our resources and borrowing against our future is what got us into this predicament as a nation?

Credit is what makes our economy different from the Zimbabwes and Papua New Guineas of the world. People can't just start a business, they usually don't have enough money to do so unless they already own the business. So they borrow. Same with college educations - people can't make the money until they go, so they have to borrow. Or, if they wait, they're less likely to go to college, which means that our country is less educated in general, which means that economy as a whole is worse off.

Only part of the current recession was caused by overlending. And that overlending was bad only because it was indiscriminate - if banks give them out knowing that there's a 99% chance they'll be repaid, then they keep the economy moving. If they're given to people who are unlikely to repay, then that money, effectively, disappears.

Add to that the credit default swaps, the predatory lending practices, and all sorts of deregulation that happened, and there was plenty of bad credit and bad markets going around. But good credit, or borrowing against the future, is what's kept the American economy what it is since the 1800's.

That's why that Kiva micro-lending website is so popular - you can give small loans of like $1000 to people in third-world countries to start small businesses. And they pay you back! And after the transaction they have a business and whoever lent the money gets their money back. But that can't happen without specialized programs because their banks don't have the money to lend and foreign banks don't want to lend it. And that's part of how they stay poor and how we stay rich.

Why should we give bajillions of dollars to companies that have already abused what we gave them a few months ago?

Ha, that's a good question. I especially liked that part of the speech where Obama was like "Congressmembers and I were furious about the fact that they didn't properly spend that money!" It's like, um, didn't you vote for the bill that had no oversight mechanism in it that those shrill dirty fucking hippies you ignored were saying needed oversight in it?

He promising oversight for the next bailout, but that's all it is: a promise. From someone who should have known better the last time around.

When will we have to bailout the credit card companies since someone who can't pay their mortgage also can't pay the Visa bill?

I think they're hoping that the current bill staves off a credit card crisis. But it won't, because it doesn't spend enough money.

The credit card crisis I think is one the banks are going to need to eat. As I understand it, most of the debt held by US citizens are in the form of high interest credit cards - all of it unsecured debt.

I just bought a new Honda and the dealer was shocked to find out my credit report is only one page long. He thought his printer was out of paper, but when he went to add paper it was full. He started to look at my credit report and he couldn't believe his eyes - I have no credit cards. He tld me most people that comes through his financing office have credit card debt in excess of $40k - and at least once a month one will show up with over $100k in credit card debt.

That is financial suicide.

But should be expect anything different? Credit card laws have been lax for ages - unemployed college students are given plastic hand over fist. Long gone are the days when you could only get a credit card if you could afford it.

Bank of America is in deep shit - they recently bought MBNA. In 2005, the time of the acquisition by BoA, MBNA had over $120 billion in outstanding consumer credit loans. But even if BoA bought MBNA at the bargain basement price of $35 billion, the bank would be able to withstand a lot of those accounts going south.

I just don't think the government has a compelling reason to bail out credit cards. I can see bailing out industries with tangible assets, but credit cards have none attached to them.
Volcker said to expect some banks to fail, those with high credit card red ink might be the first to go.

I really, really hope that debt is something the credit card companies have to eat. Because they deserve it. When they're handing out credit cards like candy to people who couldn't afford them, didn't even have to prove they afforded them, and yet....

Good luck.

But considering that Vice President Biden, the former Senator from the Bank of America and 'friend of labor' is the banking industry’s hand puppet who shackled us with a draconian new bankruptcy law it'll take a lot more than luck for that to happen. Biden is a good deal more powerful than Cheney ever dreamt of being.

Why is credit the "life blood" of our economy when overspending our resources and borrowing against our future is what got us into this predicament as a nation?

Alex's answer to this is fine, but here's my response, which I think cuts to the crux of the apparent contradiction that you, Bil, point out:

There is "good debt" and "bad debt" --- good debt is debt that is used to build expanded productivity. Borrowing for college is "good debt" because it improves both your productivity and the productivity of the nation (presuming, of course, that you follow through and get a high-paying, highly-productive job after you graduate --- don't forget that step!). Because you're making good money now, you can pay back your student loans.

"Good debt" is also when a small business owner, or a big one, borrows to build a new state-of-art factory. The new factory, if managed well, will expand the productivity of both the business and the country. Because the business is now highly competitive and profitable, it can pay the bank back for the expansion loan.

"Bad debt" is grabbing your Visa and charging up a trip to Hawaii, with no plan about how you will pay the credit card off. Or you could buy a new wide-screen TV, or a new Hummer. The new TV will not put a dime, or anything else useful, in your pocket, the Hummer will drain you week after week, and the Hawaii vacation is now nothing but memories in your head and photos in your scrapbook.

So now it's obvious that to resolve the contradiction you point out, Bil, we must discriminate between good debt and bad debt. "Good debt" when well managed, is the lifeblood of the modern American economy. "Bad debt" 99% of the time is the way we dig ourselves into a hole --- and Americans are addicted to "bad debt" every bit as badly as we are addicted to oil.

There are all "good savings" and "bad savings" ... good savings get loaned out as good debt to someone else, again expanding the economy, while bad savings get horded in a mattress unproductively, like many of the big banks are doing now with their bail-out money.

Obama et al are intending for the stimulus package funds to be utilized for "good debt" --- but even debt that is theoretically good debt has to be well managed and can't be wasted, and that is where all our worries come in. This might be America's last chance to play the debt game right, and Northern Trust taking bail-out money and throwing a party at the Beverly Hilton doesn't indicate that everyone has gotten the picture yet.

One of the better explanations for the general malaise you describe, at least as I share in it, is a post by Prof. Larry Arnhart over at Darwinian Conservatism on the Fascist Corporatism of Bush and Obama. He lays out the philosophical similarities between the Bush/Obama recovery, rescue, stimulus plans and Mussolini's "The Doctrine of Fascism," in which Mussolini criticized "the individualism and greedy materialism of classical liberalism." "Against this," Arnhart writes, "he argued for the 'corporative system' in which 'divergent interests are coordinated and harmonized in the unity of the State.' This would support Fascism as 'an organized, centralized, authoritarian democracy.' 'If liberalism spells individualism, Fascism spells government.'"

I think that's essentially what has been happening to the U.S. almost since WWII, but picking up at an accelerated pace especially during the Johnson, Nixon, Bush II, and now Obama administrations. From foreign wars we had no business engaging in to increasing over-regulation of key economic sectors that doesn't actually regulate anything, but instead bestows "most favored corporation" status to those who already have money and power, we have been on an inexorable march away from the principles this country was founded on -- those espoused by John Locke and other Enlightenment philosophers -- and toward the principles of centralized control. In short, away from individualism and toward government.

Soon enough, we will all effectively be dependent on and working for, even if indirectly, the government, which will continue to dole out resources to those willing to play by its rules and deny resources to those who don't. When the government effectively controls the vast majority of available resources, that spells fascism.

So yes, America has become a shadow of her former self, and there has yet to arise a single credible leader or political movement that can reverse this long march. I can't see how one could emerge from the Republican or Democratic parties, given that they are both working toward the same goal, if for somewhat different reasons (sometimes). The Democrats tend to stress social justice and equality more in their rhetoric; the Republicans tend to stress defense and security more. But the outcome is the same: more government, more centralization, less liberty.

The content of the bill seems to be primarily aimed at infrastructure programs that BushCo previously killed. Then there are items like police and firefighter payroll. The stimulus bill will be just one in a long line of spending bills coming - the Omnibus Budget (I think released today or tomorrow), the energy bill and the transportation bill to name the biggies.

But I understand your skepticism. We have been beat down by 8 years of lies, falsehoods and distortions. Could there have been any other outcome?

We are placing a lot of trust in Obama and I think Obama realizes that the trust in him is fragile. I believe that is the main reason for things like Recovery.gov to track the usage of the money. Obama knows if he is going to succeed, he must have an unprecedented amount of transparency. That is why he has gone all out.

Hell, on his budget crisis summit this past week, he held a press conference and the first question went to John McCain!

Yes, I have hope.... I hope Obama doesn't fuck it up.

um, Bil? it all boils down to this: we're fucked.

billions of bailout dollars are being used by companies that were poorly run- what the hell is up with that? if your local pizza place sells shitty pizza, can't have orders ready on time, and has a thousand health code violations, do you give them a hundred grand to get their act together?

or do you let them close?

problem is, we can't let every shitty bank close. Obama was right in that we need credit to flow or our economy will come to a crashing halt. on the other hand, bad loans is exactly why we are in this mess- we should ahve crashed and burned in 2002 but loaned our ways out of it.

are we doing that again?

maybe.

personally, I want to know who developed the real star trek technology to replicate items because there is no way we have that much gold in ft. knox to back up all the cash we're printing.

You're right, Sara --- but my guess is that we maxed out our collateral in Ft. Knox somewhere around 1890.

Wasn't it William Jennings Bryan that gave that famous "Cross of Gold" speech? But then, why shouldn't he? He was an old coot even then, and knew that he wouldn't live long enough for inflation to ever be his problem.

Technically, we abandoned the gold standard in 1933, but I get your point. What we're printing is the value of all the goods and services in the economy.

From the US Treasury's own website:

Federal Reserve notes are not redeemable in gold, silver or any other commodity, and receive no backing by anything This has been the case since 1933. The notes have no value for themselves, but for what they will buy. In another sense, because they are legal tender, Federal Reserve notes are "backed" by all the goods and services in the economy.

We're borrowing against future goods and services in our economy. Our assets aren't the gold in Ft. Knox or the homes we've mortgaged to the hilt. It's the work we, our kids and our grandkids will do to keep paying for this debt.

It has to be done, but it definitely needs to be done responsibly. It's not sustainable and eventually will collapse our economy. Creditors eventually like to get paid rather than loan you more money.

Unsurprisingly, one key sector of the economy that will get huge grants, aka, free money, from Obama’s bailout/'stimulus' programs is the military industrial complex. Over 100 members of congress, most of who got campaign contributions from John Murtha’s lobbying firm, PMA, also got over $300 million dollars for pork barrel military spending in their districts. Here are their names, how much they got and their PMA bribes, er… contributions. In case you were wondering Murtha is a member of the House Appropriations Committee, and Chairman of its Defense Subcommittee. Here are the links http://www.cqpolitics.com/wmspage.cfm?docID=news-000003055541
http://www.cqpolitics.com/wmspage.cfm?parm1=194

While the economy teeters on the point of no return and as working people are losing about 25,000 jobs a week and their homes and cars the self-indulgent hustlers in the White House and Congress (of both parties) are conducting business as usual, perusing personal greed. That’s why they’re extinct. They’re dead ends on the road to fundamental change.

Rome burns, Nero fiddles.

Lets see basicly nobody knows whats in this thing and the average American will not see a dime of it.Most of the construction jobs it will fund wont be hiring you unless you happen to be a construction worker with experience.The tax credit hmm I have heard every thing from 8 to 15 dollars extra week depending on what you make.Thats supposed to make me jump up and down with joy? A extra 8 bucks? We shall see the banks are in no hurry to send out loans of any kind.Round one was supposed to help do that with no oversight and nope they kept it in house.Blame Bush all you want this was the Democrates bill he just signed the thing. So stay tuned for a new round of goodies to who knows who but it wont be you!

I'm with you Bil. It's in part due to the past 8 years, starting with watching our democracy begin its decline when the Supremes placed Bush in office. We started down a slippery slope in 2000, and, unfortunately, the Democrats seemed to have glommed on to the dishonest game plan employed by the Republicans. I do not trust any of our political leaders these days, sans Gavin Newsom.

you know what I'm curious about? when the govt gets all it's shares in Citibank, and will be the largest owner, will they institute serious change?

because the people running it clearly suck.

I doubt it Sara... The entire situation reminds me of the old joke:

A little boy wanted $100.00 very badly and prayed for weeks, but nothing happened . Then he decided to write God a letter requesting the $100.00.

When The postal authorities received the letter to God, USA, they decided to send it to his local Congressman. The Congressman was so impressed that he instructed his secretary to send the little boy a $ 5.00 bill.

The Congressman thought this would appear to be a lot of money to a little boy.

The little boy was delighted with the $5.00 bill and sat down to write a thank-you note to God, which read:

Dear God:

Thank you very much for sending the money. However, I noticed that for some reason you sent it through Washington D.C. and those assholes took $95.00 in taxes.

When the gov gets ahold of Citibank, will they make drastic changes? Only if it lines their pockets.