Obama's Economy

In order to fix the economy we must first identify the problem. Obama has come to the conclusion that the problem is that:

a) There has been an increase in prices, but not in wages.
b) Tax cuts for the middle class and not the larger companies or small business.

While I do not necessarily agree on the second issue, I do agree that we either need to raise minimum wage or we need to lower all the prices and as we can see from history usually it is easier to go up and not down as far as money and economy goes. It is easier to inflate the money supply than it is to get everybody to lower the prices of everything. The plan is to “Jumpstart the Economy”. I really like the idea to give the nation a boost to get things going.

“Provide Additional Tax Rebates to American Workers”:

Giving even more of a tax rebate or another stimulus check may not be the best idea because it will be like the subprime loans where everybody takes out huge chunks of money to go spend it on toys and LCD TVs. This time it will be that everybody does not have to give back the money and will just spend it on bigger corporations rather than boosting the general economy by spending the money somewhere in the local city or town.

“Establish a $10 billion Foreclosure Prevention Fund”:

Now this is something I think will work. Offer loans for mortgages that are about to become foreclosures but only for those who need it. Offering loans to everybody will not do much if everybody, including those who by any means should not ever need loans are eligible for a loan.

“Extend and Expand Unemployment Insurance”:

I am not so sure on this one, while I know that the unemployment check does not cover much when it comes down to it, and those months go by very quickly, I also understand that there are going to be the people who abuse the long term unemployment. My opinion is that we need to extend the unemployment insurance, but make it so that you not only have to show proof that you have applied and sent in job applications, but you also have to possibly show some kind of signature from the manager of the company that will be written on a government issued form saying exactly what they are signing. Along with that there should also be some required basic info about the person who signs that, or at least have the people who sign the papers have some kind of unemployment authorize signature person thing at someplace like the post office. This does seem like a lot of work, but it is a very necessary thing to do to prevent from more people who go out on the first of the month and go get there hair and nails done, or buy a carton of cigarettes; rather than getting food for their kids.

“Provide a Tax Cut for Working Families”

I really like this idea. Again limited tax relief for people who work and who are making an effort to earn money.

“Eliminate Income Taxes for Seniors Making Less than $50,000”

I am not so sure that we should completely eliminate taxes for seniors, but rather significantly lower the taxes to a very reasonable amount based on their income, expenses, and other areas that are general looked at for taxes.

“Address Predatory Credit Card Practices”

Absolutely, it is vital that we solve the problem with credit cards, but not the way Obama wants to.

“Obama will establish a five-star rating system so that every consumer knows the risk involved in every credit card. He also will establish a Credit Card Bill of Rights to stop credit card companies from exploiting consumers with unfair practices.”

Indeed, do create a better system that explains things better and is more informative upfront, but don’t make it so the credit card companies can stop “exploting consumers with unfair practices”. All this translates into is people being able to stupidly use a credit card and not have consequenes. I think that credit card companies should be able to charge interest and fees as a consequence to stupid choices, but I do understand that there needs to be some standard or maximum level of fees that can be reached before further consequences are taken. I also think that the first ‘warning’ should be to have to take a class of some sort to educate on good credit card use. This would be similar to the idea of traffic school, but not such an all day activity, 3 hours max.

“Labor Laws”

It is good to let people peacefully strike, I am all for any protest as long as it is orderly and for a valid reason but I do not think that we should promote strickes and other such activities. In every way we do need to support fair labor, but we need not to [ass more laws that may encourage strikes because most people are not going to have a good reason to go on strike. A good example of a valid reason to strike was the writers’ strike of 2007.

Obama has some decent ideas here, but some of them are just not thing that should be taken any farther than an idea or thought. It is almost as if he is taking the ideas he has to repair the economy, but not improving on his thoughts of how they might be carried out so long as it works right now.

Ferrara, Peter J.. Social Security. Cato Institute. 1984

Helpman, Elhanan. The Mystery of Economic Growth. Harvard University Press. 2004