Time to Rethink Stimulus?

Today’s job numbers have precipitated the usual response from Washington. Spend more money! Get ready for Stimulus ll.

Now all of that might make some sense if we had been spending Stimulus l but so far official estimates put the money out the door at about 10% of what’s been appropriated. That of course leads one to the conclusion that maybe we need to rethink the whole thing. If it’s that hard for the government to spend money then perhaps we just need to put it in the hands of people that know how to go about doing that. I’m referring to the American consumer, of course.

So, why don’t we go back to square one. Let’s rescind the entire stimulus package and just suspend the payroll tax for however long it takes to get the economy back on track. This will deprive a number of politicians of the ability to direct money to sectors of the economy that represent the best bang for the buck in terms of enhancing their prospects of being reelected, but, oh well, we all have to sacrifice. And the Obama administration might have to shelve some green dreams for awhile but a grateful America will surely see its way clear to fund them later if they can just get some damned money now!

This isn’t rocket science unless you’re a government employee or an economist. The former need to make the process of funding recovery expenditures as cumbersome as possible in order to enhance job security while the latter need to argue among themselves endlessly about what does or doesn’t work in order to justify their existence. I know it’s messy and flies in the face of the need to come up with the perfect plan before we spend a dime, but just putting money in folks pockets usually results in them spending it.

So, just cut the tax, maybe shove up unemployment benefits, come up with a program to get cash to the self-employed who are dying quicker since they don’t have access to unemployment benefits and get out of the way. You might be surprised at how simple it is to get this economy rolling again.

Remember, KISS (Keep It Short And Simple Stupid) usually works well.

About Tom Lindmark 401 Articles

I’m not sure that credentials mean much when it comes to writing about things but people seem to want to see them, so briefly here are mine. I have an undergraduate degree in economics from an undistinguished Midwestern university and masters in international business from an equally undistinguished Southwestern University. I spent a number of years working for large banks lending to lots of different industries. For the past few years, I’ve been engaged in real estate finance – primarily for commercial projects. Like a lot of other finance guys, I’m looking for a job at this point in time.

Given all of that, I suggest that you take what I write with the appropriate grain of salt. I try and figure out what’s behind the news but suspect that I’m often delusional. Nevertheless, I keep throwing things out there and occasionally it sticks. I do read the comments that readers leave and to the extent I can reply to them. I also reply to all emails so feel free to contact me if you want to discuss something at more length. Oh, I also have a very thick skin, so if you disagree feel free to say so.

Enjoy what I write and let me know when I’m off base – I probably won’t agree with you but don’t be shy.

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