Economy flounders, despite the stimulus

CNN ^ | January 25, 2010 | Ron Paul

[all the best]

A year after a nearly $800 billion stimulus package was passed, the U.S. economy still finds itself mired in mediocrity.

Economic growth is stagnant, unemployment remains higher than almost any time since the Great Depression and millions of Americans are upset that trillions of dollars have been committed to numerous government bailout programs with no improvement of the economy within sight.

They question, rightfully, where this money is going and why it hasn't been as helpful as the government has claimed.

The problems with stimulus packages are manifold. The primary reason they fail is because they do not address the roots of the problem. If you are unable to identify the cause of your problem, then your solution is doomed to fail.

In the case of the current economic crisis, it had its root in loose monetary policy and easy credit that skewed the allocation of resources within the economy.

Combined with other measures to promote home ownership, these easy money policies caused a massive housing bubble. Money that would have been put to other uses was used to produce raw materials, hire workers and loaned to homebuyers, all while home prices spiked.

The boom was unsustainable as many prognosticators pointed out during the housing bubble's peak. But the damage was done, and now that the bubble has burst, we need to stand back and allow the mess to unwind. Yet the government does everything in its power to stave off true recovery and is attempting to re-inflate the bubble.

Rather than allow prices to fall so that the housing market returns to a sustainable level, the government does everything in its power to try to keep housing prices elevated.

The reasoning behind the stimulus package was that underconsumption was to blame for the collapse of the housing bubble and...

[neodad]

How unexpected...

[RoadTest]

Economy flounders because of the stimulus.

[FormerACLUmember]

CNN: “Economy flounders, despite the stimulus”

English translation: “Economy flounders, BECAUSE OF the job destroying fake stimulus”

[denydenydeny]

despite because of the stimulus

Fixed it.

[Liberty Valance]

Economy flounders because of a lack of faith in our current ‘leaders’ socialistic, redistribution of wealth, nanny-state agenda.

[alloysteel]

Mark Steyn had a caller on the Rush Limbaugh program, Tuesday, that suggested that when Obama is making one of his assertions that are silly on its face, they should burst out with thunderous laughter. For you see, it IS a joke, however unintentional, and Obama just does not have the capability to shift in the middle of one of his orations from didactic to stand-up comic. So if he gets what he believes to be inappropriate laughter, he is certain to get flustered, and once flustered, he may not be able to get back on his pace.

[colorado tanker]

The so-called “stimulus” was mostly money to state and local governments so they wouldn't have to cut budgets and lay off government union workers. Of course it didn't “stimulate” anything.

[Reagan Man]

The economy is screwed up and Obama’s policies have done serious damage to any real recovery in the foreseeable future. Unemployment will remain high and sustained job growth is years away.

Just think what shape the economy would be in if we had the same high inflation (14%) and high interest rates (21%) of the late 1970`s and early 1980’s. My guess is Obama’s fiscally insane policies would have driven the entire world into a decade long depression. Looks like we'll have to live with a decade long recession instead.

[FrankR]

When the government allots money for to "stimulate the economy", or for "jobs creation", all it is really doing is simply funding yet another entitlement project.

We all know that Government "projects" are not self-renewing...those administering the project use up the money, and then return with their hands out for more.

This administration is, again, just throwing money at a problem to buy ratings/votes in his popularity slump. He'd give away his grandmother to keep the applause sign on.

This bunch has no intention of promoting free market enterprise, i.e. GM, the banks, etc. So, don't look for any semblance of a solution for the "jobs shortage" or "economic stimulus".

The only thing all the money is "stimulating" is a slush fund so obama can buy people and votes for his infinite reign of power.

It's like, "Hey, Honey...we're dead, flat broke...let's run out and buy a new car so we can stimulate our checking account.".

Someone must have told the kenyan that you must "spend money to make money"...and he totally missed the meaning of it. In Kenya, a village is missing it's idiot.

[Oceander]

Uhhm, those of us with half a brain could have told you that would happen, without the Democrats having to waste at least $787 billion of our hard-earned tax dollars to prove, yet again, that Keynes was blowing stuff out his derriere.

[bigbob]

buh buh buh but.....the Valeria of Jarrett was on Meet the Press Sunday and said that Obama has turned the economy around!

[himno hero]

WE have loads of faith in the socialistic and redistributive powers of Obama. Thats why I am sitting put. in the do nothing mode. Whatever I earn will be hit hard. The capital? Will be hugely at risk.... until the marxist/jihadist is gone.

[RoadTest]

“Economy flounders because of a lack of faith in our current ‘leaders’ socialistic, redistribution of wealth, nanny-state agenda.”

Yes, plus their arrogant narcissism and presumptuousness

[ari-freedom]

maybe it’s not because of the stimulus? Maybe it’s because of the regulations and the fear that if you become too successful, Obama’s czars will punish you

[RoadTest]

“maybe it’s not because of the stimulus? Maybe it’s because of the regulations and the fear that if you become too successful, Obama’s czars will punish you”

I’m sure that is throwing cold water on potential business ventures.

[rabscuttle385]

Check this out.