published Thursday, February 10th, 2011

'Stimulus' in Tennessee?

No one can say that Tennessee and the rest of the nation were not warned about the financial dangers of Congress' passage of the $862 billion so-called "stimulus."

Time and again, experts and "ordinary folks" alike made the commonsense observation that the stimulus would further bloat our national debt. They also pointed out that using stimulus funds to prop up state budgets would encourage states to put off hard spending cuts.

But those concerns were brushed aside as Democrats rushed to approve the stimulus on promises -- later disproved -- that it would vigorously boost the private sector and keep down unemployment.

Now the chickens are coming home to roost. As expected, some states failed to cut spending significantly after they got stimulus funds. And now, with the funds running out fast, some literally face the possibility of bankruptcy.

Even in conservative states such as Tennessee that behaved more responsibly, stimulus money only delayed, rather than eliminated, the need for deeper spending cuts. The heads of numerous state agencies went before Gov. Bill Haslam recently to spell out big new cuts that will be required to balance Tennessee's budget. Again and again, the loss of stimulus funds was cited as increasing the severity of the cuts.

Is that an argument for Congress to pass another stimulus? Certainly not! The first one failed miserably, leaving us in more debt and making government even bigger, but not holding down unemployment as promised. It didn't solve states' budget problems; it only put them off for another day.

Well, "another day" has inevitably arrived. And not only is the federal government unable to "rescue" the states with more stimulus spending, but it is saddling them with new multibillion-dollar costs related to ObamaCare. Nobody in Washington seems to have a clear idea how states are supposed to pay those costs -- which is probably why most of the states have sued to stop ObamaCare before it can do further harm.

What our nation needs isn't more federal spending but a hard dose of reality. We need to recognize once again that free enterprise is the engine of our economy, and that it cannot succeed if the federal government ignores the clear limits placed on Washington by our Constitution.

Have we learned that lesson yet?

We hope it does not take the eventual insolvency of programs such as Medicare or Social Security before enough Americans realize that out-of-control government spending, taxing and debt carry an awfully high price.

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carlB said...

Opinion » Free Press Thursday, Feb. 10, 2011 'Stimulus' in Tennessee?


Reply: It would appear that you will not accept the possibility that another complete failure of our financial systems would have occurred if President Bush's administration had not applied the $700 billion dollars to the TARP. Along with the money used by the FED? What happened to the private enterprise systems that they needed to be bailed out?
What could have possibly occcurred if the $700 billion dollars and President Obama's $$862 billion dollars recovery money was not used at the time when the unemployment was increasing at a rate of over 700,000 thousand per month? Where is the rescue by the private enterprise sectors that should be stepping up to create new jobs preventing this Republic from having the high unemployment rate? From what you are saying, you would not have done anything to stop the failure of the private financial systems or to stop the loss of the jobs that were occurring before President Obama was even elected Presisent? Yet you want the people to think that everything is Obama's fault since the private sectors have not done what they should have done by reinvesting in the USA.

Why do the Republicans not want to nor will they admit that this Republic was in such a "free fall" from the effects of the 2007 deep recession, caused from the fraud in the financial systems and the "race to the bottom" caused by the global economy, that the free fall had to be stopped and stabilized to prevent another great depression. Therefore it took extra money to be spent. More money was needed to stop the fall because of how bad it was, but since the total National Debt was already run up to $12.0 trillion dollars by the last administration, getting a recovery after the stabilization is taking more additional money. The Republicans and the other opponents of Obama apparently want theis Republic to fall into another great depression because they are hindering this recovery in every way that they can and dividing the opinions of the people while not helping with the needed recovery. This is the same repeat by the Republicans as happened during the 1929 great depression, only then it was Four years and the conditions of the depression were getting worse before FDR was the President in 1933.

February 10, 2011 at 6:45 p.m.
rick1 said...

In reference to Obama's $862 billion stimulus please read the study by Daniel J. Wilson of the San Francisco Federal Reserve Bank, suggests that the net job creation from the $814 billion stimulus bill passed in February, 2009, was zero by August 2010. In the first year, the stimulus "saved or created" 2 million jobs (not 4 million as repeatedly claimed by the Administration), but this number proved to be short lived, paying for temporary jobs, at a very high cost of $400,000 per job "saved or created." A study by Daniel J. Wilson of the San Francisco Federal Reserve Bank, suggests that the net job creation from the $814 billion stimulus bill passed in February, 2009, was zero by August 2010. In the first year, the stimulus "saved or created" 2 million jobs (not 4 million as repeatedly claimed by the Administration), but this number proved to be short lived, paying for temporary jobs, at a very high cost of $400,000 per job "saved or created." http://www.economics21.org/blog/outcome-stimulus-and-burden-proof

Obama is not fiendly to businesses despite what he says. Take a look at who Obama's heros, mentors and friends are. They all supported Marxisim, including Saul Alinsky, Frank Marshall Davis, Jeremiah Wright, Jim Wallis, Cornel West, Bill Ayers where Obama started his political career in Ayers living room.

He was drawn to Marxists as a student and regularly attended "socialist conferences" (his words) at Columbia University. He also attended these conferences at Oxidental College.

He devoted his first memoir to his late communist-sympathizing father, who proposed massive taxes and redistribution of income in Kenya. ("What is more important is to find means by which we can redistribute our economic gains to the benefit of all," wrote Barack Hussein Obama Sr.

He eschewed the private sector after college to work as a community organizer for radical Alinsky groups in Chicago, agitating against banks and other businesses.

Obama's Marxists beliefs and his economic policies have not made it a positive environment for business to hire and expand.

February 10, 2011 at 8:32 p.m.
carlB said...

http://www.economics21.org/blog/outcome-...

rick1 | On: February 10, 2011 at 8:32 p.m

Reply to rick1: A Reader’s Guide to the 2012 Budget http://www.economics21.org/commentary/reader%E2%80%99s-guide-2012-budget

Some where you missed the point and that was the question of whether this Republic should be allowed to go into another great depression or for everyone to work together in preventing a depression? We can read the biased reports on what the stimulus recovery money has done or has not done and whatever you want to believe you can find it. There is a difference between a reasonable report and an extremely biased report. Even in the FP opinion it was biased against what the stimulus money has done. Yet, they have proved that the stimulus has saved jobs and helped stabilize the effects of the 2007 recession.

I have given a lot of thought to whether it would have been better to go along with what the Republicans would have done in saving this Republic from another great depression if they had been reelected. Judging from the Republicans' actions against President Obama, they would have kept the Government out of the picture and let the private financial enterprises take care of getting us out of the 2007 deep recession after their bail out. That means the Republicans would have done "nothing" to create manufacturing jobs here and In my opinion that would put this Republic right in the middle of another great depression, but the Republicans did not win the election in 2008.
President Obama is having too many problems from his opponents now in trying to prevent another great depression without any help from them. It would not be good for this Republic to be in another great depression because of the uncertainly of what the conditions would bring and what the possible development would turn into during the unknown length of time a great depression would last. We have to get out the conditions which actually caused the 2007 deep recession and we can do it by getting our manufacturing base jobs back and balancing the trade deficit. But the $12.0 trillion dollars of total National Debt passed onto Obama is not making it easy for getting the global corporate monopolies to reinvest into manufacturing here.

Therefore, if this Republic had continued to fall, how much farther would the Nation had fallen before bottoming out? Everything would be shutting down all of a sudden without anytime given for the people to adjust? Of course the question is, to what would the people have to adjust? What would be the plans for getting out of another depression? Hopefully, now the conditions are more stable and if we have to devalue the dollar it would not be an extreme devaluation.

February 11, 2011 at 12:20 a.m.
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