If you think anyone in Washington is serious about budgets, deficits or the economy, think again. Do you remember the National Commission on Fiscal Responsibility and Reform? As Caroline Baum puts it on Bloomberg.com, Obama received the report and promptly “filed it in the bottom drawer,” that was December 2010. Why wasn’t this report used nine months ago to form the basis for action? Why do we keep starting over and over?
If you hear about more stimulus spending especially on infrastructure, you should ask what happened to the $850 billion allocated in 2010.
If you think extending and expanding the payroll tax holiday is a good idea, think back what you did with your extra money for all of 2011, did you save it, pay off debts, raise your 401(k) contribution or did you stimulate the economy by buying something other than necessities like food?
If you run a business think what it will take for you to hire a new employee with all the accompanying costs (salary, benefits, taxes, hiring costs, workspace, etc.) and what it will take for you to retain this employee on the payroll. Will you take on that obligation for any reason other than your business requires the services of an additional employee to meet customer demands in some manner?
If you want to know why nothing seems to be working ask yourself why you don’t spend money. Is your income flat, are you not earning enough on your CDs, are you afraid of what may happen in the stock market, do you have debts, are you trying to save for retirement, are you just worried about the future in general?
Once you have the answer to the above question, listen to every idea coming from Washington and then ask yourself which of those ideas will get you to spend money. Only then will the economy begin to get better and the unemployment rate begin to decline.
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