Monday, February 9, 2009

What If It Doesn't Work?

We tax all the others and pass the revenue on to you

What's Plan B for the economy? We've spent nearly a tril over the last six months bailing out financial institutions and buying TARP assets at inflated prices. Our government (both parties) hopes we'll overlook that they didn't provide for any oversight for the spending of that tril. It's only money and we'll forget pretty soon anyway, won't we? We always did before.

Now we're going to spend another tril or so on "stimulating" the economy. Around $820B but there'll be more, direct and indirect. Count on it. I can't quite describe how that stimulates me. You probably think that people like you and me are going to get big shares of the money to spend (stimulate) because, after all, it's our money. Nope. 500 bucks or so each, maybe some minor tax cuts, that's all we can be trusted with.

The lion's share of the money is going to major banks... again. We can trust them, can't we? Who could blame you for asking "Aren't those the same people who got us into this mess?" And yes they are, overseen by the same folks who overspent $78B of your money on TARP assets just a few months ago. $78B is a LOT of money. A tril is a lot more.

All this is by way of asking, what happens if the plan doesn't work? We can't do it again, the plan uses up all our money. Maybe not all of it but all the government has to spend right now. If we need much more, if the plan doesn't work and work well, who's left to tap? China, the Saudis or our home-grown rich? The latter are already getting out of Dodge (hello, Dubai!) and the other two are waiting, lurking, planning their own strategies to sop up the stimulus gravy.

When the worst seems to have passed, on that blessed day you can expect payback time, when interest rates and gas prices and necessities spike prices higher than you could ever imagine. The west, especially the US, has few friends. It's every country for itself. Witness Russia's energy aggression on top of its real and threatened aggression. What are we going to do about it? What CAN we do if we spend our future now... and it doesn't work?

There's only going to be us left to fix what we didn't break, to pay for the excesses of those who robbed us, to turn our backs on the friends who once trusted us absolutely.

God willing, the plans will work and we'll put this crisis behind us in fairly short order. Maybe our leaders will actually lead us out of our wilderness. Maybe fraud, waste and abuse will diminish. Maybe we'll each personally commit to sacrificing for the greater good of our country and fellow Americans. Maybe we'll buy only what we can afford and skip a few luxuries, be content with less. Maybe the people we give our money to will use it wisely, even return it someday.

Maybe... but what if it doesn't work?

Even if you're on the right track, you'll get run over if you just sit there. Will Rogers

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