A Conservative Review of the Obama Administration Part 7 (The Stimulus)
Posted: Monday, January 18, 2010
by Jim Anderson
Weddings That Last
As the country entered into a banking crisis that was caused primarily by excessive borrowing by the public, or excessive lending, whichever way you want to look at it, the stage was set to create historic legislation to move the progressive agenda forward. The solution was the stimulus package that would cost more than most Americans could imagine. It was sold as the solution to high unemployment. It cost $787 billion and was passed without debate under a strong sense of urgency that our economy would totally collapse if we didn't act immediately. Yet, there have been over 4 million jobs lost since then.
At the same time, in the healthcare bill, money was used to bribe senators for votes. The CBO reports that the special adjustment for the Louisiana deal in the bill is $100 million from the Federal Government, but the senator claimed the deal was really $300 million. Nebraska, Vermont, and Massachusetts will cost $1.2 billion over a ten year period. Vermont is $600 million, Massachusetts is $500 million, and Nebraska is getting the Federal Government to pick up the tab for the state's Medicaid costs forever.
Now, congress has even gone further, outside the stimulus bill, and guaranteed unlimited funds for Fannie and Freddie who were at the core of the financial crisis to begin with. Right now, the Federal Government already owns 50% of all mortgages. All this while they have given big raises to the executives there as the pay czar is tightening the screws on executive compensation at private companies.
The stimulus bill was supposed to be what we needed to fix the economy. However, the crisis deepens and the Federal Reserve Bank continues to monetize debt at an ever accelerating rate. This is similar to what happened in Germany just before the rise of Hitler in the Weimar Republic. Ben Bernake promised that he would not be monetizing the debt in his testimony before congress, yet today we are selling treasury bonds and then buyers are selling them to the Federal Reserve Bank. 47% of these bonds are sold back within 10 days from when they were issued. When the Federal Reserve Bank buys these bonds, they print new money to do it. This is monetizing the federal debt.
This process is accelerating. In the first 3 quarters of 2009, the "other investors" category grew from $90 billion in 2008 to $510 billion and the year still had a full quarter left. The Federal Reserve category (buying them itself from the Federal Government) grew 60% over 2008 to $286 billion. No one is auditing the Federal Reserve Bank, so these numbers could be actually fiction, we don't really know how bad it really is. PIMCO, an institutional investor, is taking a more conservative position on these bonds and so is China.
For more on the financial problem this is leading us to see the next article A Conservative Review of the Obama Administration Part 8 (The Debt)
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Top-level comments on this article: (2 total)Why can't the guys and gals we elected understand this? And do something about it! Great piece - time to Warpit!Please log in to respond to this comment.Thank Marijo! In at least one of the other articles in this series I touch on your question. In short, they are progressives and they aren't as stupid as they appear. If you understand that the modern day progressive is virtually holding to the same values as communism and marxism, their actions and their decisions start to make logical sense. If this is correct, our country is in grave danger if voters don't shift the balance of power in congress. I believe we are seeing events of historical proportions that our grandchildren will study in school whether we are still the USA or become comrades of the UCSA (United Communist States of Amerika). ;-)Please log in to respond to this comment.Very frightening! KEEP writing!!!Please log in to respond to this comment.
Some great points here, Jim. I've gotten to the point where the transparency of this regime is difficult to see through.Please log in to respond to this comment.There was never really transparancy, it was a perception of transparency they were trying to create. However, I think they underestimated the power of the people in a free society.Please log in to respond to this comment.You're right...Americans are often oblivious of our political "masters"...all the way up to the point where they get annoyed...like now...once aroused Americans at large can be quite formidable. I think we've almost reached that point. Hence the rise of the Tea Party and the election of a Republican in MA!Please log in to respond to this comment.
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