Tuesday, March 10, 2009

American Recovery and Reinvestment Act

The estimated wealth loss throughout the world by the IMF is now put at 50 Trillion Dollars. The Obama American Recovery and Reinvestment Act ended up at about 800 Billion Dollars after concessions to the Republican Senators who are intent on keeping the failed policies of the Bush Administration in place. Only about 25% of the $800 Billion is targeted to be spent throughout 2009, half of which is accounted for by tax cuts that the Obama Administration conceded to the Republicans. Tax cuts in a downward spiralling economy will accomplish only one thing, it will preserve the wealth of the wealthiest who are least affected by the Economic Depression. The only purpose these tax cuts serve is to cut much needed revenue from the Federal Government. While the Republicans clamor for tax cuts, they also squawk about the deficit, the same deficit that grew out of control under the Republican Congress and the Republican Bush Administration.

While the U.S. Government and the Federal Reserve has placed trillions of dollars of liquidity to the Financial Institutions whose over leverage and bad business practices led to the current Economic Depression, the Republican hierarchy led by John McCain and John Boehner continue to cry about excessive government spending on the rest of America. The American Recovery and Reinvestment Act is a fraction of what has been spent propping up the financial institutions as multi-national banks, yet McCain and Boehner have nothing to say about these policies that began under the Republican Bush Administration ans was distributed by the Republican Secretary of Treasury Paulson, who came from Goldman Sachs, one of the beneficiaries of the original $350 Billion in TARP funds distributed by Paulson without accountability. The reciepents of the money distributed by the Bush Administration were able to spend the money any way they wanted even though the Bush Treasury Department sold the TARP program to Congress as a way to replenish the credit markets and enable banks to loan money into the economy. As usual with the Bush Administration what was said in public was not what was done behind closed doors.

Now with the Economy worsening everyday causing homelessness and tent cities like those during the Hoover Administration to pop up in even the most affluent of communities such as Sacramento, CA., the Republican Leadership still tries to perpetrate the myth that the wealthy must be accommodated in order for the economy to recover. The Obama Administration seems to be buying into this myth as they continue to administer the TARP program as established by the Bush Administration with only slight adjustments to the way in which the money is distributed.

The American Recovery and Reinvestment Act has a very slim chance of affecting any kind of recovery. In 2009 the total expenditures will amount to no more than $100 Billion while the problems created over the last eight years require over $3 Trillion Dollars in US Government funded stimulation. The American Recovery and Reinvestment Act is doomed to fail, not only because the Obama Administration acquiesced to the Republicans and included 46% tax cuts in the total bill, but because their sights were set to low. The current situation cries out for programs funded in the Trillions of Dollars that will not only create jobs immediately but will build a strong foundation for the future.

It is imperative that the Obama Administration massively fund the research, development and implementation of energy self sufficient buildings and homes. It is imperative that the Obama Administration offer a clear concise plan with a target date of ten years to eliminate gas and diesel powered vehicles. Change happens with bold planning not a continuation of the past.
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