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Democrats to increase tax burden over $5,000 per taxpayer





jmi256
I saw today that the Democrats say they intend to send Obama a new bailout bill on inauguration day that could total up to $700 billion ($700,000,000,000). Given that there were only 138 million taxpayers in the US in 2007, that's over $5,000 each taxpayer is going to have to pay for this pork. This is just a straight calculation, but seeing that many taxpayers pay no taxes or receive a handout at tax time, the actual amount each working taxpayer will have to pay would be higher.

Besides the burden this is going to place on working taxpayers, three other things bother me about this:

1. The Democrats refuse to release any details about the bill (or at least I haven't seen any yet), but I'm sure there's a lot of waste/paybacks. Where is the money going?

2. The Democrats are waiting until they have full control to ram this bill in. If the bailout money was really needed, why wait? Instead they are waiting until they have full control and there is no opposition.

3. During the campaign Obama promised to limit the bailout to $175 billion, but I guess his promises aren't worth anything.
Futile
For the last year I have read all of your "wingnut" views as well as your major opposition's "moonbat" opinions. You started (a year ago) off having good, solid, valid points and then slowly digressed into something between a true internet wingnut blogger and a conspiracy theorist. I could really careless one way or other what your stance is and will not get into a flame war with you because history has shown, at least with you, that if you do not have a conservative view you are wrong. But I would like to correct you on one of your points:
jmi256 wrote:
3. During the campaign Obama promised to limit the bailout to $175 billion, but I guess his promises aren't worth anything.


The Bailout has always been 700 billion. Obama promised a 175 to 200 billion stimulus package. Those are two different issues.

True I have my own doubts and concerns about the next few years but last time I checked a man is innocent until proven guilty. The bottom line is the man is not even in sworn in yet. Give him a chance to mess up and then you can yell, "I told you so", all you want.
But until then please give the man a break and us too for that matter.
jmi256
So you don't want to get into a flame war, yet you start off with name calling? But I'll ignore your little rant and name calling for now. BTW... I've only been on this forum for a little over two months, so I don't know where you get this "year" from. You're obviously confused. No wonder you can't get the numbers straight.


Futile wrote:
The Bailout has always been 700 billion. Obama promised a 175 to 200 billion stimulus package. Those are two different issues.


Whether you call it a "stimulus" or "bailout" it's the same thing. Here's an article about it from just a month before the election. Now that election is over, he has ballooned the number to $700 billion. The original article is from USA Today, but is reprinted on another site (sorry, I couldn't find it quickly on the USA Today site). Now if you want to argue the definition of a "rescue plan" vs. "bailout" vs. "stimulus," go ahead. But I think most people are intelligent enough to realize this is all the same. Obama and the other Dems are just interchanging the words to fit the audience they're speaking to.

Quote:

Obama has new $175 billion rescue plan

Democratic presidential candidate Barack Obama on Monday proposed additional measures he says will jump-start the economy and protect investors, including tax credits for businesses that hire new workers and penalty-free withdrawals from retirement funds.

``Right now we face an immediate economic emergency that requires urgent action,'' the Illinois senator told an audience in Toledo, Ohio. ``Congress should pass this emergency rescue plan as soon as possible.''

In a conference call with reporters, Obama economic adviser Jason Furman said that the Democrat's proposals, combined with earlier economic stimulus proposals, would cost $175 billion over two years and would increase the federal deficit - a move Obama is willing to make to respond to the economic emergency.

``Our biggest priority next year is to avoid a very deep recession,'' Furman said.

McCain advisers criticized the Obama proposals as spendthrift and counterproductive.

``More spending is going to make the situation worse,'' said Rob Portman, a former budget director for President Bush. Allowing retirement fund withdrawals, he said, would only encourage Americans to cash in their stocks at their lowest value.

McCain's senior policy director, Douglas Holtz-Eakin, said McCain will unveil additional ideas for dealing with the economic crisis Tuesday. McCain is scheduled to speak in Blue Bell, Pa.

Key elements of the Obama plan:

- Penalty-free withdrawals of up to $10,000 from IRAs and 401(k)s in tax years 2008 and 2009.

- A $3,000 tax credit for every new full-time job created in the U.S. by businesses in 2009-10.

- A requirement that banks benefiting from the federally funded bailout provide a 90-day moratorium on foreclosures to give homeowners time to work out a payment plan.

- Empowering the Federal Reserve to provide short-term loans to state and local governments caught in the credit crunch.

Nariman Behravesh, chief economist at the consulting firm Global Insight, gave Obama's proposals an overall grade of B. He gave the most favorable reviews to the Democrat's plans for giving Americans more flexibility with their retirement funds and for helping cash-strapped state and local governments. He questioned the value of a foreclosure moratorium, however, pointing out that most mortgages have been resold so many times ``it's unclear who's actually holding the assets.''

With the election three weeks away, Republicans and Democrats on Capitol Hill also sought to be responsive to the economic downturn. All 435 House seats and 35 of the Senate's 100 seats are at stake this fall.

House Minority Leader John Boehner, R-Ohio, said further congressional action to stimulate the economy ``should not wait until January.'' Boehner proposed a series of tax cuts, including one that would lower or eliminate taxes on corporations who buy distressed assets like mortgage-backed securities and another that would extend the $250,000 capital gains tax exemption to investment property.

House Speaker Nancy Pelosi, at a news conference, said Democrats would hold hearings in coming weeks on various economic proposals. She was noncommittal on whether she'd call lawmakers back to town after the election for a lame-duck session.

House Financial Services Committee Chairman Barney Frank, who joined Pelosi, said his committee will consider ``sensible regulation'' of derivatives, financial instruments that contributed to the crisis. They amount to bets between financial institutions on the value of stock prices, index or underlying assets. ``A failure to regulate the economy appropriately is what led to this mess,'' said Frank, D-Mass.

In an interview, Frank criticized Boehner's proposal as being too focused on business. ``It's time to give direct help to average citizens and that just doesn't do it,'' Frank said.

Source = http://www.qctimes.com/articles/2008/10/13/news/local/doc48f3ed9eda29f825715640.txt



Futile wrote:
True I have my own doubts and concerns about the next few years but last time I checked a man is innocent until proven guilty. The bottom line is the man is not even in sworn in yet. Give him a chance to mess up and then you can yell, "I told you so", all you want.
But until then please give the man a break and us too for that matter.


He's not sworn in, but the Dems are working on this bailout bill right now, and intend to give it to Obama as soon as he's sworn in. So do you expect everyone to just shut up and go along with the program as money is handed over to poorly run companies who now want taxpayers to foot the bill for their screw-up? I don't. This is real money from real people. Where do you think the $700 billion will come from? The "rich" and corporations who own businesses? Not be so naive. They'll just pass any tax increases on to the end consumer, so the burden will fall on individual taxpayers.

The other question is where is this money going? The Dems refuse to provide any info and are purposely waiting on the bill until there is not opposition. Why not be transparent? And if this is such an emergency, why the wait?

Listen, I do not want Obama to "mess up," and I'm not interested in any "I told you so's." I pray that everything he does pays off in spades and we get the country back on track. He's now my Commander in Chief and I'll follow him. But I will question and criticize when I feel there is something amiss. To expect that we all follow him blindly like lemmings is unrealistic.
ocalhoun
jmi256 wrote:
He's now my Commander in Chief and I'll follow him.

Not yet he isn't! He isn't the boss of me until he gets sworn in.
Bikerman
Just to be clear; there is a huge difference between a fiscal stimulus and a bailout.
A bailout, in this case, is action taken to keep the financial markets moving. It largely consists of buying up 'toxic' assets and putting in place guarantees by either buying stock in institutions, taking them into public ownership (as has happened here in the UK), or putting government backed guarantees on savings into place.

A fiscal stimulus is basically introducing more money into the economy (by tax cuts, funded by increased borrowing) in an attempt to keep consumers spending money and therefore keep business 'flowing'.
jmi256
ocalhoun wrote:
jmi256 wrote:
He's now my Commander in Chief and I'll follow him.

Not yet he isn't! He isn't the boss of me until he gets sworn in.


Good point. I guess I should have said "Once he's my Commander in Chief, I'll follow him." But the sentiment is the same.
ocalhoun
Bikerman wrote:
Just to be clear; there is a huge difference between a fiscal stimulus and a bailout.
A bailout, in this case, is action taken to keep the financial markets moving. It largely consists of buying up 'toxic' assets and putting in place guarantees by either buying stock in institutions, taking them into public ownership (as has happened here in the UK), or putting government backed guarantees on savings into place.

A fiscal stimulus is basically introducing more money into the economy (by tax cuts, funded by increased borrowing) in an attempt to keep consumers spending money and therefore keep business 'flowing'.

But both involve the government taking away my money and giving it to people who don't deserve it for free... Sad
Bikerman
ocalhoun wrote:
Bikerman wrote:
Just to be clear; there is a huge difference between a fiscal stimulus and a bailout.
A bailout, in this case, is action taken to keep the financial markets moving. It largely consists of buying up 'toxic' assets and putting in place guarantees by either buying stock in institutions, taking them into public ownership (as has happened here in the UK), or putting government backed guarantees on savings into place.

A fiscal stimulus is basically introducing more money into the economy (by tax cuts, funded by increased borrowing) in an attempt to keep consumers spending money and therefore keep business 'flowing'.

But both involve the government taking away my money and giving it to people who don't deserve it for free... Sad

Well, my point was in response to the suggestion that Obama had lied about the 'bailout'. The suggestion is untrue, as can be clearly seen if you understand the terms.

The alternative is to let the banks go bust and watch businesses fail incrementally as the credit system collapses. Some old socialists like me are actually snickering at the whole mess, but I'm not sure that you would want a complete collapse of the financial system..
deanhills
All of this still boggles my mind. If you look at this from a criminal point of view. People lived beyond their means (this includes the banks and all the other greedy institutions) and now by being bailed out, how much responsibility is left for them to be held liable for their actions? What would make me feel good is when there is a very transparent description of the problem. I.e. debt is for example 2 trillion dollars. The goal is to reduce this to x trillion by x date. In order to do this, the following remedies will be taken. And finally, this is the point where those who had overextended themselves will have to take responsibility for their actions, by going through the following pain. I only see band-aids over bleeding gashes. No real delving into the root problems and sketching long-term plans and what the price of those will be.
Bikerman
Well, in my humble opinion this pales into insignificance when you consider the US national debt (currently over 10 trillion dollars). Americans have been living beyond their means for many years and now they are co-dependant on China, Japan and other states who have bought huge amounts of US treasury bonds in order to finance the 'American dream'. Bush, in particular, seems to have implemented tax cuts whilst at the same time embarking on foreign 'adventures' of an extremely expensive nature.
deanhills
Good point, and the pie chart is really impressive. 10-trillion! Wow, think all of the nation should attend Debtors' Anon meetings. You are right Chris. This is probably the equivalent of alcoholism, and to go totally cold turkey may kill the person. It would need some special medicine first, to build resistance, and then possibly the pain after that could be survived. However, financial memories are so short and that is what I am worried about. The objectives should be clearly stated, aimed for and reached. And then the next ones created.
jmi256
Bikerman wrote:
Well, my point was in response to the suggestion that Obama had lied about the 'bailout'. The suggestion is untrue, as can be clearly seen if you understand the terms.


The issue isn't understanding the terms. If you look at the article I posted above, what you define as existing within a stimulus is what he outlined within his bailout/rescue.

He even calls his $175 billion proposal a "stimulus":

Quote:
In a conference call with reporters, Obama economic adviser Jason Furman said that the Democrat's proposals, combined with earlier economic stimulus proposals, would cost $175 billion over two years and would increase the federal deficit - a move Obama is willing to make to respond to the economic emergency.



The point I was making is that a little as three weeks ago he promised to limit a bailout/stimulus/rescue to $175 billion (still a huge number and a waste of taxpayer money in my opinion), and now he's advocating for a $700 billion bill while refusing to disclose who will receive the money. That means someone (i.e. taxpayers) is going to end up footing the bill.
Bikerman
jmi256 wrote:
Bikerman wrote:
Well, my point was in response to the suggestion that Obama had lied about the 'bailout'. The suggestion is untrue, as can be clearly seen if you understand the terms.


The issue isn't understanding the terms. If you look at the article I posted above, what you define as existing within a stimulus is what he outlined within his bailout/rescue.

He even calls his $175 billion proposal a "stimulus":
You still don't get it. What you outlined was a fiscal stimulus package. The fact that the newspaper chose the headline 'rescue plan' is the fault of the newspaper editor, not Obama. The proposal to buy toxic assets and 'bail-out' the banks is entirely different and separate (and is, incidentally not Obama's proposal - that is Bush).
Quote:
The point I was making is that a little as three weeks ago he promised to limit a bailout/stimulus/rescue to $175 billion (still a huge number and a waste of taxpayer money in my opinion), and now he's advocating for a $700 billion bill while refusing to disclose who will receive the money. That means someone (i.e. taxpayers) is going to end up footing the bill.
And you are still wrong. It is BUSH who has asked for the 700 billion, and that is specifically to bail-out the banks. Obama's proposal is entirely different - it is a fiscal stimulus. I really cannot explain it in more clear terms - it is really quite simple if you put aside your blinkers and read the text.
Futile
Bikerman wrote:
jmi256 wrote:
Bikerman wrote:
Well, my point was in response to the suggestion that Obama had lied about the 'bailout'. The suggestion is untrue, as can be clearly seen if you understand the terms.


The issue isn't understanding the terms. If you look at the article I posted above, what you define as existing within a stimulus is what he outlined within his bailout/rescue.

He even calls his $175 billion proposal a "stimulus":
You still don't get it. What you outlined was a fiscal stimulus package. The fact that the newspaper chose the headline 'rescue plan' is the fault of the newspaper editor, not Obama. The proposal to buy toxic assets and 'bail-out' the banks is entirely different and separate (and is, incidentally not Obama's proposal - that is Bush).
Quote:
The point I was making is that a little as three weeks ago he promised to limit a bailout/stimulus/rescue to $175 billion (still a huge number and a waste of taxpayer money in my opinion), and now he's advocating for a $700 billion bill while refusing to disclose who will receive the money. That means someone (i.e. taxpayers) is going to end up footing the bill.
And you are still wrong. It is BUSH who has asked for the 700 billion, and that is specifically to bail-out the banks. Obama's proposal is entirely different - it is a fiscal stimulus. I really cannot explain it in more clear terms - it is really quite simple if you put aside your blinkers and read the text.


Don't waste your breathe Biker like he said most intelligent people know the difference. But you know how us lemmings are.
handfleisch
Bikerman wrote:
I really cannot explain it in more clear terms - it is really quite simple if you put aside your blinkers and read the text.


Hmm, that sounds familiar, but from where? ... oh here it is

http://www.frihost.com/forums/posting.php?mode=quote&p=828435

handfleisch wrote:
I don't know how to explain it more clearly. ... it seems to me that if you have read any articles about this subject, you would already know and understand that.


It seems the more things change, the more they stay the same.
Bikerman
PS - News here reports that the Fed has authorised ANOTHER $800 billion as part of the bailout... Smile
Blame THAT on Obama if you can....
jmi256
Bikerman wrote:
You still don't get it. What you outlined was a fiscal stimulus package. The fact that the newspaper chose the headline 'rescue plan' is the fault of the newspaper editor, not Obama. The proposal to buy toxic assets and 'bail-out' the banks is entirely different and separate (and is, incidentally not Obama's proposal - that is Bush).


I’ll try to explain this as simply as possible. Despite your belief to the contrary, the terminology really isn’t that important. The net effect is the same. But in hopes to decrease your confusion, I’ll use your terminology.
1. During the campaign Obama promised to limit his “stimulus” to $175 billion. I know it was soooooo long ago, but maybe you remember? If not, see the article I posted above.
2. After the campaign, this “stimulus” package has miraculously turned into a $700 billion pork bill that the Democrats claim is so important that they want to wait until two more months so they have complete control and there can be limited transparency.
3. This pork bill will cost each taxpayer over $5,000

Honestly, are you just trying to muddy the waters? I have a hard time believing you really can’t comprehend this.


Bikerman wrote:
And you are still wrong. It is BUSH who has asked for the 700 billion, and that is specifically to bail-out the banks. Obama's proposal is entirely different - it is a fiscal stimulus. I really cannot explain it in more clear terms - it is really quite simple if you put aside your blinkers and read the text.


You’re the one who brought Bush into this, but I’m talking about the bill Democrats are working on and holding until Obama is in office. What you’re talkling about above is a bill that has already undergone scrutiny and was passed and signed already. I personally don’t agree with that bill, but at least there was transparency and debate.

Here is a link to an article about the proposed bill that tacks on another $700 billion in tax burden in case you really are just ignorant about the proposed bill.:

Quote:

Obama Will Get Stimulus Bill First Day, Democrats Say

Nov. 23 (Bloomberg) -- Congress will send President-elect Barack Obama an economic stimulus package the day he takes office Jan. 20, two Democratic lawmakers said today.
Senator Charles Schumer of New York said on ABC’s “This Week” program that the package will be between $500 billion and $700 billion. House Majority Leader Steny Hoyer, of Maryland, said on “Fox News Sunday” that he believed the Inauguration Day goal would be met, but he declined to put a price tag on the bill.
“I think Congress will work with the president elect starting now and will have a major stimulus package on his desk by Inauguration Day,” Schumer said. “I think it has to be deep. My view it has to be between five and $700 billion.”
Obama said yesterday he aims to save or create 2.5 million jobs in his two-year plan to stimulate an economy facing a “crisis of historic proportions.”
The U.S. economic slowdown has been exacerbated by the worst credit crisis in seven decades. More firings will weigh on the economy and consumer spending will pressure Obama and Congress to agree on legislation that will stimulate growth, economists say.
Economic Team
Obama is moving quickly to assemble his economic team.
Timothy Geithner, head of the Federal Reserve Bank of New York, will be nominated Treasury secretary, and Lawrence Summers will head the National Economic Council, Democratic aides said. Summers served as President Bill Clinton’s last Treasury chief.
House Speaker Nancy Pelosi today said any stimulus package must be several hundred billion dollars. “The sooner we do one, the smaller it can be,” she said on the CBS “Face the Nation” program.
Senator Richard Shelby, the Alabama Republican who is the ranking member of the Senate Banking Committee, said he wants to see the details of a stimulus package before deciding whether to back it. “I want to support things that are meaningful for the economy,” Shelby told ABC.
Obama’s stimulus plan involves an infusion of cash for middle-class tax cuts, rebuilding roads, bridges and schools, building broadband Internet access and investing in clean energy.
Tax Cut Expiration
Obama strategist David Axelrod suggested that Obama might consider delaying a repeal of Bush administration tax cuts for the wealthy by allowing them to expire as scheduled at the end of 2010. “Those considerations will be made,” he said.
The president-elect is “committed to getting middle-class tax relief in the pipeline quickly, and there’s no doubt that we’re going to have to make some hard decisions in order to pay for the things we need,” Axelrod told Fox today. “The main thing right now is to get this economic recovery package on the road, to get money in the pockets of the middle class.”
Senator Carl Levin, a Michigan Democrat, opposed allowing the tax cuts “for the upper brackets” to expire, saying on CNN’s “Late Edition” program that Congress should move more quickly to end them. “We just can’t afford to continue them,” he said.
House Republican Leader John Boehner of Ohio pushed for cutting the capital-gains tax to stimulate the economy.
Capital Gains Tax
“If we’re really serious about creating jobs, what we ought to do is we ought to eliminate the capital-gains tax,” Boehner said on Fox. “Why not lower capital gains taxes for -- and corporate income taxes for corporations in America to help keep jobs here?”
Senator Joe Lieberman, an independent from Connecticut argued for action before President George w. Bush leaves office Jan. 20.
“I’m concerned that we’re between presidents now, and in the meantime, the economy continues to cycle down, and, to a lot of people, out of control,” Lieberman said on CNN’s “Late Edition” program.
Policy makers have “to get banks to start lending money again,” Lieberman said. “They’re not lending money, and, until they do, this economy is going to go nowhere.”


Futile wrote:

Don't waste your breathe Biker like he said most intelligent people know the difference. But you know how us lemmings are.


Hey, I see you’re back and with nothing of value to add.

handfleisch wrote:

Hmm, that sounds familiar, but from where? ... oh here it is

It seems the more things change, the more they stay the same.


And you brought a friend. How nice.


Bikerman wrote:

PS - News here reports that the Fed has authorised ANOTHER $800 billion as part of the bailout...
Blame THAT on Obama if you can....



Again, you have your facts wrong. This isn’t a new authorization, but rather an employment of funds authorized in the first $700 billion bailout. The $700 billion went into a fund, which already had a balance, giving the $800 billion amount you saw. I’m not going to post the entire article I saw, but you can view it here if you want.

http://www.reuters.com/article/domesticNews/idUSTRE4AO4QY20081125?feedType=RSS&feedName=domesticNews&rpc=22&sp=true
Bikerman
jmi256 wrote:
I’ll try to explain this as simply as possible. Despite your belief to the contrary, the terminology really isn’t that important. The net effect is the same. But in hopes to decrease your confusion, I’ll use your terminology.
1. During the campaign Obama promised to limit his “stimulus” to $175 billion. I know it was soooooo long ago, but maybe you remember? If not, see the article I posted above.
2. After the campaign, this “stimulus” package has miraculously turned into a $700 billion pork bill that the Democrats claim is so important that they want to wait until two more months so they have complete control and there can be limited transparency.
3. This pork bill will cost each taxpayer over $5,000

Honestly, are you just trying to muddy the waters? I have a hard time believing you really can’t comprehend this.
Err...I comprehend perfectly. It is you that doesn't know the difference between a fiscal stimulus and a financial bailout package.
Now, to the details.
1) Bush has currently asked congress for a $700 billion bail-out (now $800 billion). Yes?
2) Obama talked about a $175 billion stimulus during his campaign.
3) Some Democrats think the stimulus will cost much more - 500-700 billion - we don't yet know.
Quote:
Again, you have your facts wrong. This isn’t a new authorization, but rather an employment of funds authorized in the first $700 billion bailout. The $700 billion went into a fund, which already had a balance, giving the $800 billion amount you saw. I’m not going to post the entire article I saw, but you can view it here if you want.
Well, news is patchy over here so you could well be correct. The point remains that Bush has effectively authorised $800 billion which will be used to bail out the banks. Obama has promised $175 billion, which may rise to 3 times that amount, or even more, and which will go to ordinary Americans in tax breaks, public building programmes and other measures to reduce unemployment and keep consumer spending moving. No doubt this will have to be clawed-back in taxes when the economy picks-up,

Which do you think is the more reprehensible? Bailing out the banks or putting money into the economy during a recession?
Here's a clue - the first gives your money to corrupt and financially irresponsible institutions with little hope of any recompense for the tax payer. The second is standard economic practice used by just about every government in modern times during times of recession.
The simple fact is that both are probably necessary to maintain the financial system and avoid a meltdown, but I know which sticks most in MY throat, and it isn't the fiscal stimulus.*

If you want to criticise anyone for running up huge public borrowing then I would have thought that Reagan and, to a lesser extent, G.Bush are the two obvious candidates over the post-war period.

* Yes - exactly the same thing is happening here in the UK but obviously on a smaller scale.
mathiaus
I consider myself to be fairly into politics. Where I get really confused however is the economy. All of the numbers and mainly the terminology just wash right over my head.

Bikerman however I feel has explained some differences very well and I now understand his point completely.
LumberJack
Arguing over proposed legislation several months away, eh? Don't you have more pressing things to worry about. What about the CITIgroup bailout, don't tell me you have a problem with that....
LumberJack
jmi256 wrote:
I saw today that the Democrats say they intend to send Obama a new bailout bill on inauguration day that could total up to $700 billion ($700,000,000,000). Given that there were only 138 million taxpayers in the US in 2007, that's over $5,000 each taxpayer is going to have to pay for this pork. This is just a straight calculation, but seeing that many taxpayers pay no taxes or receive a handout at tax time, the actual amount each working taxpayer will have to pay would be higher.

Besides the burden this is going to place on working taxpayers, three other things bother me about this:

1. The Democrats refuse to release any details about the bill (or at least I haven't seen any yet), but I'm sure there's a lot of waste/paybacks. Where is the money going?

2. The Democrats are waiting until they have full control to ram this bill in. If the bailout money was really needed, why wait? Instead they are waiting until they have full control and there is no opposition.

3. During the campaign Obama promised to limit the bailout to $175 billion, but I guess his promises aren't worth anything.


Don't forget, the Fed's are increasing the burden on American Taxpayers multi-fold. With the trillions of dollars that have been printed, and an interest rates that are at historical lows. I am afraid you must worry a bit more than taxes by the Dems.
Futile
Ok, I will state something that is of value. You are correct in the statement that the proposed "stimulus" package amount of 175 billion will be increased to an undisclosed amount estimated to be around 600 to 800 billion. As far as where this money is going Obama’s stimulus package’s objectives and goals all allegedly the same as he first stated just the amount has changed. IMO ---I do not feel that he “lied” about the amount. I lean more toward the stance that the situation is really far worse than the government has let on and if you are going to enact a plan it will do you no good if you don’t have the funds in order to see it to fruition.

However you are incorrect about the difference between a bailout and a stimulus. As Bikerman has already stated in so many words a bailout is an injection of”liquid or toxic” assets in order to help a bank or corporation in times of short-term cash flow crunch. A Governmental bailout is used when the failure of a corporation or institution would cause unacceptable short-term economic repercussions throughout the economy, i.e. banks, lending institutions, major employers. Sad thing about it is the government gets to pick which companies to save or let drown. Here is where our money goes to failing or near bankrupt companies. Problem is this money is created out of thin air and us as consumers feel the cost in the form of inflation. A true stimulus actually decreases taxes while it increases spending. The money spent goes into the economic infrastructure by providing tax-rebate checks for consumers, usually Middle to lower America in our case, as well as spending on school repairs, roads and bridges, aid to states, and tax credits for job creation. This is not just Obama's plan. This plan's framwework and basis has been used in other countries and been succusful.

This is not a Democrat or a Republican issue and to make it such really distracts from the issue. Congress and the House have always "taken" the holidays off so to speak. It just so happens that this year happens to be a changing of the gaurds. But all partisanship aside the bottom line is the government is set to spend up 7 trillion dollars in order to bailout the economy. That is 23,000 per American and more than half the U.S. annual gross domestic product. The stimulus package is just tip of this economic iceberg. And we the Middle Class are the Titanic no matter which way it floats.
liljp617
I'm sure they have good reason (that I'm unaware of), but why don't they give everybody in the US a million dollars?
deepviolet
I always hear talk in the media about taxpayers ultimately having to pay when the government spends money.

However, based on my understanding of economics, it isn't the taxpayers who ultimately have to pay the bill because government policy tends to be to lower taxes to encourage consumer spending. The money is raised instead through selling treasuries.

Therefore, it seems, that it is actually people who have saved and live off of their savings who take the greatest hit.
ParsaAkbari
Uh they make thier laws to suit the majoraty unfortunatly.
Bikerman
deepviolet wrote:
I always hear talk in the media about taxpayers ultimately having to pay when the government spends money.

However, based on my understanding of economics, it isn't the taxpayers who ultimately have to pay the bill because government policy tends to be to lower taxes to encourage consumer spending. The money is raised instead through selling treasuries.

Therefore, it seems, that it is actually people who have saved and live off of their savings who take the greatest hit.

No, this is not correct. Firstly I don't really know what you mean by 'treasuries'. I presume you mean government bonds? Well, yes, that is the main way that Governments borrow money. They issue bonds which are bought by the population, investors (national and foreign), pensions funds and the like.
The problem is, of course, the government has to pay interest on each bond (based on the face value).
Let's say you have $1,000 US bonds bought last year (series I bonds). They currently have an interest rate of about 5.5%. That means the Government must pay you $55 every year until you sell the bonds, or until they 'mature' (normally 30 years). If you do the sums you will see that when inflation is low then bonds are a good investment, but when inflation is high, they are a terrible investment.
Now, yes, I agree that people living off their savings are currently in trouble. This is because interest rates have been successively lowered in order to try to stimulate growth in the economy and prevent a lengthy recession. For people living off money invested then this is very bad news, since the interest on their capital is much reduced.
deepviolet
By treasuries, I did mean government bonds. I meant the stuff that you buy at treasurydirect.gov. Given all these terms (bills, notes, bonds), it's hard to keep the terms straight, but I was really hoping to answer the question of who takes the hit.

I think it is safe to say that when financial transactions take place, wealth is constantly shifting around. Some people's buying power is increased, while other people's buying power is decreased.

The question is that when government starts paying big money (for wars, bailouts or what not), who is getting enriched and who is getting poorer?

The biggest gainers would appear to be those on whom the money is spent on. If I work in the defense industry, I get enriched, for example, if the government spends big money on wars.

But this must be at the expense of someone else. In essence, when 200,000 soldiers get put on a payroll, they consume goods and services while producing nothing that is of value to someone like me. The money the soldiers earn is now competing with the money that people have saved so far for goods and services. This suggests that whoever has saved the most money takes the greatest hit. The people who live the paycheck to paycheck lifestyle are the smarter ones. Those are the taxpayers of the future.
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