If there is one thing you can be sure of, it is this: when it’s election season, all the politicians will sound their alarmist horns.
Case in point: the economy.
Suddenly all the big shots are calling for a stimulus package, especially Bush, who has had a change of mind and decided that we are really facing an upcoming recession. To use his own phrase, the economic outlook is becoming “increasingly mixed.” What the fuck does that even mean?
Anyways, all the Pols are sounding off on the fact that foreign investors and countries are buying up shares of our finance firms like Merill-Lynch and Citigroup. And you can bet your money that the Pols are saying that we can’t surrender our money markets to “foreigners.”
Never mind the fact that capital markets are global, or the fact that China has been financing your average American citizen’s consumption and debt-ridden lifestyle for the last decade or so, the fact is that we need foreign investments to bail out our own financial corporations. Furthermore, we can only hope that the weakening dollars will increase our export revenues and hopefully shift the balance of payment positively, if only for a little bit.
But lest one forgets, a weakening dollar means all of our imported commodities become less affordable, and the most important import commodity that every single American, no matter how rich or how poor, will always need: OIL.
So all this talk about giving everyone a tax rebate ignores two considerable facts. First, the rebate (which looks like it will realistically be about $500 to $600 per household) will not make a huge difference considering the weak dollar. Second, the tax cut does not cover people who don’t make enough to pay income tax, but precisely because they make so little, they are more likely to spend whatever tax rebate they do receive, thus more likely to pump that money back into the economy.
This is why I get exasperated when I watch presidential debates, because nobody has the balls to say anything based on actual economic analysis. Instead, we get vague answers like tax rebates, “green-collar” jobs, and stopping free trade.
In the words of Arrested Development, Come On!