Can Washington prevent a recession?
N came home for dinner last night and told me about the announced plan to offer “tax-rebate checks of at least 300 dollars per taxpayer, with some seeking as much as 800 dollars per person or 1,600 dollars per household”. They think giving people money to encourage them to spend more will fix all the issues in the economy? Can you believe that?
Most experts say that recession is unavoidable and that the announced plan is not going to be “the cure all “. You can listen to the audio segment and read the blurb about it here.
One of the major problems with the economy now is the huge overstock in housing. Sellers are asking high prices that most buyers can’t afford and if they can afford to buy getting a loan is impossible. People who have recently bought homes are in jeopardy of loosing them due to adjustable rate mortgages and increased debt to income ratio.
People are loosing their homes to foreclosure over adjustable interest rates, they have marked their home prices up and are trying to sell but the amount of foreclosures already are making the banks lend less which in turn makes it impossible for new buyers to buy the homes that are on the market and in jeopardy.
Another issue is that money is tight for most middle/ lower class families because oil prices are high, that strains the economy. Oil prices not only affect how much we spend in transportation it also affects the price we pay for food and other supplies because it takes oil/ gas to transport these items.
With money being so tight many people have managed to rack up high amounts of debt and have little savings, many people are struggling and I don’t think that a measly tax rebate check will solve the countries problems. It’s the “quick fix”/ half-assed way of trying to make things better.
Our country should be focusing on alternative fuel options, making home purchases more possible for the middle and low class families, paying workers more/ creating more jobs and improving home life/ life satisfaction.
Sometimes I just don’t understand how so many elected government officials loose sight of what is really important. I mean I understand that increased spending could boost the economy but just because spending has dropped doesn’t mean we need to increase it. How about we take a look at the aspects behind why spending has dropped and fix those underlying issues instead of just slapping a band-aid on the wound?
This announced plan is a lot like our countries obsession with many prescription drugs- a quick fix that just masks the underlying issues. I’ll save that for another post though!