The first half of the TARP money has had mixed results and has been criticized by both sides for a lack of accountability. Even so, the Senate approved the second half of the money because apparently the problem was just President Bush and Secretary Paulson - surely President Obama and Secretary Geithner can do better. In fact, Obama has pledged that up to $100 billion of the money would be spent on the mortgage crisis, which leaves me wondering: what is the other $250 billion going to be spent on?
So now we have another stimulus package just passed by the House and crafted in cooperation with the President-elect. That "plan" includes $550 billion in emergency spending, but spending on what? How is government going to create new jobs by spending more money? Are these jobs going to be stable? Are they going to exist without continued government funding? Does anyone know the answers to these questions?
Every politician wants to be seen as doing something to fix the problem. Every politician wants to be able to take credit for bringing us out of this recession. When that happens we get representatives and senators who basically throw money at the problem in the hopes that something will work. Maybe we need to step back and let bad companies fail. I know it sounds harsh, but should we be saving and propping up businesses just because we're afraid of it happening while we're in office? The answer is no.
One of the best critiques I've seen yet comes from none other than Texas congressman Ron Paul. Now, Paul was not my choice for president and I find a lot of his positions a little too out there for my tastes, but one thing I think he is right on is the government's role in the economy. My favorite excerpt:
Politicians and bureaucrats have already done their fair share to ensure that jobs in the private sector are prohibitively complicated and expensive to create. They are now shocked that the economy is shedding jobs, and want to simply create hundreds of thousands of jobs to make up for the job losses, through another so-called economic stimulus package. The private sector must be permitted to do that, but instead they are massively burdened with taxes and webs of red tape and regulation. Washington's bandaids will only prolong this agony. The Austrian school of economics teaches that only a free market economy, unencumbered by onerous government controls, creates long-term prosperity. Politicians, however, tend to be notoriously short-sighted.The more we spend, the more we add to our already massive deficit and national debt. The more we try to bailout failed businesses, the more our children will have to pay in taxes when the bill comes due. Does any political leader have a dollar figure in mind that means we can't spend more? At what point do we realize just throwing money at the problem won't work?
I hope that point comes very, very soon.