A
few years ago I was reading an essay, and at one point the author
commented on the common cold. Essentially he pointed out that
treated or not, when you have one it lasts about a week.
The
decision was yours of course.
Suffer
through and trudge along… seven to ten days of a cold. Or...
Antibiotic
or over the counter suppressants or more sleep or plenty of orange
juice… treat it aggressively and with everything at your disposal…
and... seven to ten days of a cold.
You
could ease certain symptoms… knock yourself unconscious to get
some sleep… try any sort of medical or home remedy you wished
to allow you to cope and get through it… but the true recovery
period wasn’t going to change much.
I’ve
often thought about that observation at a variety of times. The
underlying message of it… that for many things you can improve
the conditions, but it’s time that affords the healing, and at
its own pace… works for me.
Earlier
this week I read articles about state employees being laid off
in California… and a Trump group filing for bankruptcy (for the
third time, I think, which makes it quite the business model)…
and public and private programs or projects that are being slashed
and delayed and cancelled all over the place. And these are just
the articles from the recent moments. In January weren’t hundreds
of thousands of people added to the ranks of unemployment?
So
you can imagine how impressed I was the other morning when, while
listening to the news as I readied myself for work, I learned
that the government stimulus package was trying to get people
out buying new cars by offering tax advantages. And... well...
I didn’t get it.
I
don’t want to sound naive… and I don’t want to sound ignorant…
and I definitely don’t want to minimize the problems here. Yup…
absolutely… the auto industry is a leading employer in this country,
if not for the manufacturing of cars then for the repairs and
the parts and all manners of service associated with them.
The
problem is… it sure seems like no true relief is being offered
in any way. At least no way that appears sensible to a common
sense approach.
What
do I mean?
Ok…
I’ve seen lots of companies that have been suspending 401k payments
and matching contributions. So… sure… maybe the company saves
money right now. And maybe a person can adjust their contribution
rates so they actually get a few additional in-pocket dollars
out of upcoming pay checks. But… umm… haven’t we been told to
wait these rough seas out and our retirement funds will eventually
bounce back? I’m just asking, because actions like these… and
others that will encourage people to withdraw what little money
may remain in many of these accounts… sure sound like trouble
brewing for people when they finally start considering their retirement.
It’s a bandage now… that may create the need for a tourniquet
later.
That’s
just one example. Back to those new car tax breaks. What I’m referring
to is difficutlies at home. Personal help. Exactly how does helping
me in one way… say with tax relief on a new car purchase… help
me out when you are planning to increase gas taxes and turn more
interstate highways into toll roads?
Maybe
I’ve got things out of focus. After all, it’s always easier to
ask how it all addresses issues in my home without truly understanding
what is happening down the street. If these monies are getting
people to buy cars… then the automakers are keeping people employed…
and the economy improves. And... yeah... that’s a good thing.
So
the money is going to get people back to work. Right? I mean,
that’s even what they said. We’ll see jobs created if the plan
is working. Yes?
Well,
at one point during Tuesday morning’s broadcast of Today,
they were discussing the stimulus plan and said that 74% of the
allocated monies should be in use by some point in 2010.
Do
you need to read that again? Because it stopped me in the middle
of fixing my tie.
Seems
that while alot of articles and news reports are warning us to
prepare for a long road back, most are interviewing people hoping
for some signs of recovery by the end of the summer. Have you
read similar articles? Now… summer of 2009 to see some hope… but
a quarter of this money will still be undedicated in 2010? Does
that sound right to you?
Ok…
then here is where we fully arrive at that ignorant and naïve
part.
I
suppose some of the money might be there for long term projects.
That might not be spent right away.
Some
of the items included in the package could be health care… tax
relief… and expenditures that don’t take place until 2010 or after.
Or
perhaps it’s a support structure to keep things moving in the
right direction once the improvement has begun. After all… you
don’t stop taking two weeks worth of doctor ordered medication
just because you’re feeling better after day two.
So
I do recognize that there could be reasons for it, even if I’m
being dumb for not considering the possibilities.
But
it sure doesn’t sound right.
Instead
it sounds suspiciously like my common cold thoughts… that everyone
is going to have to adjust to the new order of things, and ultimately,
the economy will improve whether we do something or not.
Look…
I’m not so foolish as to believe that doing absolutely nothing
will work. It won’t. Leave some things untreated and they’ll kill
you. And the economy needs something… several things…
to help it along.
Here’s
what it doesn’t need… plans that give us $20 in one hand while
taking $30 out of our pay checks.
And
the media… good lord, the media. Want to help slow down the recession
and start the healing? Here’s one way…
Newspapers…
television stations… web sites… whatever. Run an article, conduct
an interview, or post an essay that has any possible negative
content and you will be fined. Let’s say $5 million per infraction.
Instead of worrying about Janet’s boobs and Britney’s panties…
we could assign the government watchdog agencies to this one and
let them fine the crap out of the media.
Why?
Because every time I see the word “economy” on the internet or
hear it from some reporter, my 401k nosedives.
People
are scared… and believe me, justifiably scared considering unemployment
rates and all the declarations coming from businesses. But hammering
them with story after story after story is just driving their
fears to new heights.
I
wish I had a better solution. I don’t. I wish I had more specifics
about whether the stimulus plan will or won’t work… and even whether
it is a stimulus plan or a spending spree… whatever. I don’t.
What
I can tell you is that things will get better eventually. And
they will get better whether we treat it aggressively or not.
They may not get better for everyone… and it may not be quite
the better we had all hoped for, as quickly as we could have had
it… but things will improve.
~ ~
~ ~ ~
Am
I oversimplifying the problem? Am I missing the charts and graphs
and development plans from people far more understanding of business
models than I?
Yeah…
maybe I am.
But
on Tuesday… February 17, 2009… The Providence Journal had
an article posted about the city of Woonsocket. After trying to
cut salaries… after trying to raise insurance contributions… the
city has basically come to the point where saying goodbye
to 100 employees (60 firefighters and 40 members of the police
department) is the result.
This
article has all sorts of fun in it. Wage cuts and higher bills
for the individual… losses for the community… and, whipped cream
on the sundae, a promise of a court battle from the union (which
one can only believe should be referred to as “a costly
court battle” if truth be told).
But
the most fun is in the comments. As I write this, the comments
are bashing the union and union members… and supporting the layoffs!
Then…
another article from The
Providence Journal. I was reading it, and what a stimulus
package might mean for Rhode Island. And as I went over it, I
started thinking that maybe 12… 18… 24 months wasn’t as distant
as it seemed when I typed my wisecrack about only having 74% of
the money working by 2010. Then I hit this comment in the summary
section:
“An
estimated 91,000 Rhode Islanders would be added to the food stamp
rolls by 2013, injecting an additional $55 million into the state
economy.”
Please
read that again…
“An
estimated 91,000 Rhode Islanders would be added to the food stamp
rolls by 2013, injecting an additional $55 million into the state
economy.”
Doesn’t
this statement say that adding 91,000 people as food stamp recipients
will be good for the economy? Can that be true? Now hold on… before
you jump in with a quick yes… remember, the comment also talks
about 2013! This is not addressing people of immediate
need. This is not extending unemployment benefits for 2009… 2010…
2011. This is not working with stores and people in need to pay
bills and get food for the next 24 to 36 months. This is talking
about an increase in need more than four years away!
Are
government assistance programs… when the results are showing that
more people are qualifying for them… good for the economy? What
am I missing? Because it sure sounds to me like a way of saying
increased unemployment… rising demands for welfare programs… and
efforts like this are positive things.
So…
more needy people… good for the economy.
Yeah.
This is making all sorts of sense.
~ ~
~ ~ ~
Ok…
I know… I’ve given you lots of ammunition for firing back at me.
I’ve shown that I don’t know how the economy works. And I’ve compounded
it by saying we’d almost be better off doing nothing.
The
reality is, I was exploring this subject and I honestly didn’t
know where this essay would take me. I had a couple of thoughts…
wanted to unite them, because I felt like the general concept
worked… and started out on my adventure.
And
I am left with the feeling that while it is important to do something,
in general terms fear is as much of the problem as anything else.
Fear of spending… fear of dwindling 401k accounts and retirement
savings… fear of the news reports and negative stories.
And
as I continued, I hit on these subjects with general impressions.
Not deep… detailed… thoughtful research into what stimulates an
economy. But a quick read and response that says I don’t understand
how having more unemployed people is going to help us recover.
Oh,
but wait… one of the points of the stimulus package… one of the
ways to notice whether or not it is working… is that more jobs
are created. Right? Remember that? So obviously my general observations
don’t really work. Because when this train gets a-rollin’, there
will be paychecks and 40-hour a week opportunities for everyone!
Hmm…
ok.
As
I finished the first draft of this article, General Motors and
Chrysler had just submitted their reports and requests to the
federal government.
Turns
out they need more money than they thought. $21.6
billion in emergency loans.
And
in return… sit down, this is the good part… “they
promised the government, they will slice even more people and
plants to cut costs…”
50,000
jobs lost… 14 plants closed… and that’s just
the information to be gained from these articles written today…
in February of 2009. Remember, just a few weeks ago these same
people didn’t anticipate sluggish car sales when believing they
needed just a bit less money.
And
let me close with this…
The
state of Connecticut is working on a plan that will pull
state monies from the resident trooper program. It will
shift all of the bills to the towns and communities with resident
state troopers.
It’s
like going to dinner and no one brought their wallet. Everyone
has good intentions. And someone is going to pay the check. But
it sure looks like coffee and dessert won’t be an option. Seriously…
just filter through some of the comments on these articles. These
people have no clue.