Time to Face Facts

The leaders in Washington keep telling the public that their so-called Stimulus Bill must be passed immediately or the country might face “irreversible” decline. Never does anyone in favor of it explain why each expenditure is in the bill or how it will make the economy suddenly work better.

They insist that most people want a stimulus bill passed immediately, but few people have any understanding of what’s involved.

Let’s take a look at the math:
Pretend that some entity began spending $1,000,000 US dollars on the day that Jesus was born. And, for the sake of argument, pretend that Jesus was born on December 25. Since that time 2009 years and 44 days have passed. Including 502 extra days for the leap years, the total number of days is 733,831. So, under these circumstances, the total spent by today would be a mere $733,831,000,000 or $196,169,000,000 LESS that the $930,000,000,000 currently included in the Senate “Stimulus” Bill.

2009 X 365 = 733,285
Plus 502 extra days for leap years + 502
Plus 44 days since Christmas + 44
TOTAL DAYS 733,831

$1,000,000 per day $733,831,000,000

Approximate total on Senate Bill $930,000,000,000 (at 11 on Friday Morning)

HOW MUCH GOVERNMENT SPENDING CAN WE TAKE?


Another way of looking at it is that the Senate wants to spend $930,000,000,000 over and above the regular budget (based on 2007 figures) of approximately $2,730,000,000,000, and the Emergency Economic Stabilization Act of $700,000,000,000 that was passed in September despite public disapproval. These items adds up to:

Senate Stimulus Bill $930,000,000,000
Approximate Budget $2,730,000,000,000
Emergency Economic Stabilization Act $700,000,000,000

TOTAL EXPENDITURES $4,360,000,000,000


That is $5,941,422 for every day since Jesus was born based on legislation passed or in the process of passing since September. Or, it works out to be $14,533.33 for each man, woman, and child of the 300 million people in America.

And we still don’t know what happened to the first $700,000,000,000 and see no evidence that it has helped the economy at all.


WHAT ELSE IS IN THE PIPELINE?

Unknown to most are the proposals that Mr. Obama has in the pipeline, such as Universal Health Care, expansion of the welfare state, or the Global Poverty Act that Obama introduced to the Senate in 2007, and mentioned on the campaign trail. Plus the costs of Social Security and Medicare increase every year while fewer workers contribute.

I firmly believe the citizens need to take a deep breath and quit wringing their hands. Legislation passed in haste is seldom done well. First we need true accountability for the $700,000,000,000 from September. Where did the money go? Did it help in any way? How can we best spend what is left? Why are records not available to the public who is paying for it?

HOW TO RECOVER FROM FINANCIAL CHAOS

Every person and every organization that find themselves in financial difficulties know that the only way to get out of the problem is to increase income and/or cut expenses. For individuals, one usually takes on an additional part time job to increase income and cut back on expenditures until the crisis is past. Organizations do the same thing by selling assets, increasing prices, and cutting overhead. The fact that the US government is a very large organization does not change the equation.

The way to increase income to the government is to cut tax rates. It has been proven by the actions of Kennedy, Reagan, and Bush. Tax revenue increases do little good unless there is also a reduction of expenses. Failure to rein in spending was George W. Bush’s downfall and eroded the base of support he did have. Adding a trillion dollars of new expenditures will not help Barack Obama either.

Absolutely no financial analyst would argue that an organization should increase spending by borrowing so much money that it will require generations to repay, as the Stimulus Bill will.