The economic stimulus bill appears to be more like a “wish list” than a stimulus recovery bill. Has everyone in Washington lost sight of what this bill was intended to do? Many in America has lost their jobs, their homes, their livelihood, their dignity, and now add to that list - more money; as all tax payers will have a tax liability in the near future to re-pay the money we are spending today.  This is not only wrong, but in my opinion it is also immoral. All of us in “politics”, have been trusted to do what is right regardless of party lines or ideologies, but nevertheless we see more of the same attitudes in Congress that led us to this mess to start with.

Let me explain my views, for those of you that have little knowledge of economics. Fiscal policy is the money the government spends out of the tax revenues they receive from all taxpayers. If we spend more money than we receive, then it is said that we have a deficit. The U.S. is currently on a deficit, and we keep borrowing more and more money to make up for the shortfall. The government borrows from other investors or countries in much the same way we do, if we need a loan to buy a new house or a car. The problem with this shortfall, is that more of our money percentage-wise, is going back to re-pay the interest on our debt. This means that in the future, there will be less money available for programs that we truly need, for which there will be no funding available. Things that really matter to all of us like: education, defense, universal health care, Medicare, Medicaid, and many more will suffer because we will no longer be able to afford them.

Fiscal policy is in fact very limited in scope because even a strong spending bill does not “guarantee” any kind of recovery. In reality, none of these politicians have produced one single economist that can assure us that the new spending will get us out-of-the-hole. This bill is just more of the same pork-and-barrel, and less of the stuff we really need. My fellow Americans, don’t be fooled and led to believe that this is good for America. We need a bill that makes sense, one that attacks the real causes of the financial meltdown – the housing market. We need to fix the housing market, and keep homeowners in their homes – where they belong!

When we started this discussion, back during the Bush Presidency, the initial TARP (Troubled Assets Relief Program) Bill from Secretary Paulson required the purchase of toxic assets. That plan was later changed, because supposedly it was too hard to “evaluate” the real worth of these assets, and hence we gave the money – to the tune of billions of dollars to the banks who were partly responsible for this mess.  I do not believe in bank bailouts!  However, I believe that we could have negotiated with the banks for them to bear some of the costs, and in return we could have covered for the remaining losses. 

Let’s say for example, that John Doe is about to loose his house because his income has now gone down, and he can no longer afford his mortgage payment. The program that I am describing, would encourage banks to re-negotiate the terms of the loan in order to reduce the monthly payment to the homeowner. By doing so, the banks along with the U.S. government would then bear an even split on the losses incurred during the process, but would effectively keep the homeowners from loosing their most precious asset – their homes! The incentive that I have described forces the lenders to negotiate because it is on their best interest to do so, if they are to limit their losses. This is in-effect, a market stop loss order. Whereas in the current plan, we took that incentive away by directly giving billions of dollars to banks who are not accountable, and to this day can not and will not tell us how the money was spent. This is in my opinion not only a real shame, but is also criminal and fraudulent in nature.

I advocate for an expansionary monetary policy which is different than the fiscal policy. Recall that the fiscal policy is the money that the government spends, but one that is much limited in its focus. The monetary policy on the other hand, has a much broader scope in nature and can help stimulate the necessary growth without the costly effects of the fiscal policy. The Federal Reserve Bank or the “Fed”, can expand the liquidity in the market by expanding the money supply and decreasing the interest rates, and through other various market operations (some of which are already in place). 

Politicians need to be accountable of how they spend the taxpayer’s monies. Like everyone else, I want to stimulate the economy and create jobs. I want to revitalize the housing market and provide the right conditions for growth in the years ahead. However, the spending must be targeted to what it is intended, so that we can all reap the benefits at the lowest possible cost. It is not ethical, in my opinion, to create a free-for-all bill that takes advantage of the emotional and economic despair that this economic climate has brought upon all of us. The current version of the Stimulus Bill that was approved by the Senate, advocates for more spending in things that we don’t need, one with a somewhat limited possibility of stimulating our economy in the short-run. We need to focus our attention into the real stimulus provisions that will help solve our current economic crisis. Things like: tax cuts, lower payroll taxes, extending unemployment compensation, and projects that will create jobs. These are the kind of ideas that will provide our nation with the best recovery efforts, and in a much shorter time-span.