On Monday, July 28th, fresh off his President of the World Tour, Senator Barack Obama (D-IL) held an economic summit of experts and business leaders that endorsed the idea of a second economic “stimulus” package to “spur consumer spending.”
This would come atop the first $150 billion “stimulus” package that was enacted in late February. Sold as “tax rebates,” the first package was in truth a giveaway: there was not a single off-set in federal spending. Thus, the deficit increased by $150 billion as a result of the package.
The White House admits as much, based on recent statements by Jim Nussle, Director of the Office of Management and Budget:
“The ailing economy and the government’s massive $150 billion bipartisan stimulus package caused the current higher-than-average deficit. According to Nussle, without the stimulus plan, the deficit would be about $272 billion or 1.9 percent of the economy.”
Instead, this year’s deficit is about $389 billion, and next year it is projected to rise to $482 billion. But wait, it gets even worse:
“The White House said the 2008 deficit is also actually higher than current estimates because it does not include the Medicare bill passed by the Senate earlier this month and the housing bill approved last week. The Medicare bill replaces a 10.6 percent pay cut to physicians with a 1.1 percent pay increase, while the housing bill provides $300 billion for the Federal Housing Administration’s insurance program.”
As can plainly be seen, the problem is that Congress year-in-year-out keeps on spending far more than it takes in, boosting the money supply in the short run, and expanding the debt, now nearing $10 trillion. Deficit spending, pure and simple, is inflationary, it’s weakening the dollar, and it’s hurting the nation’s overall economy.
Some may tout the original “stimulus” package as a tax “rebate,” but in fact it comes with strings attached. It was more like using a credit card. The government taxes the people, then “gives” them back these “rebates,” with the stipulation that eventually, one day, the American taxpayer will have to pay off the ensuing debt caused by the deficits.
And so it will be with Obama’s second “stimulus” package. Sure, they call it “stimulus,” but really it’s cyanide for the American economy—as well as generations to come who spend their futures, and their fortunes, trying futilely to dig themselves out of debt.
