Reality Checks: Economy
I’ve noticed an extremely annoying trend in politics recently – I’m looking at you tea-partiers – where populist morons have no idea what they are talking about. You’ll pardon the harsh language, but I think it’s about time that both sides stop pointing fingers in the direction of Obama or Bush or Clinton and start recognizing that most of what happens in history is built up over time. Very little just pops out of the blue.
That said, I’d like to run through a quick list of reality checks regarding the current state of the economy:
The BAIL-OUT and the STIMULUS are two completely different things, but they were likely both necessary evils. I will explain why:
The Bail-Out
- The Bail-out is money that is being directed towards banks. The way a bank works is this: They have to have assets (which is made up of money owed to them and money that it currently possesses as reserves) and they have debts, which is money they owe to people who have invested in their bank. These two numbers must always be at least even, though they can have more in assets than in debts. If they have more debt than asset, they can’t loan anything out, and are considered insolvent.
- A lot of banks assets are in homes, which they technically own in the form of mortgages that homeowners are paying off on. This works most of the time, but homes don’t have a fixed value. The value fluctuates with the Market. So when the housing bubble burst, the value of houses plummeted, and as such, many of the banks became insolvent.
- The Bail-out was an alternative to nationalizing the banks. If the banks had gone out of business, America would be in a Depression right now.
- The effect of the bail-out was to buy up a lot of their bad (called “toxic”) assets. That’s what we did. Keep in mind that Americans still own a lot of these assets, in theory, so if the value goes back up, we make that money back. It’s not necessarily money lost. However, because the government is so scared of being called “socialist,” they aren’t flexing their muscles like a usual business stock-holder would.
The Stimulus
- The concept behind the stimulus is still debated. It’s called Keynesian economics. John Maynard Keynes, a renowned economist, suggested that during a recession or a depression, private investors naturally became protectionist and stopped lending or investing, which crippled the economy. It would be unreasonable to ask them to lend, so instead, the government should start spending to try and stimulate the economy.
- Technically, it’s all pork-barrel. That’s the point. The point is to spend on select programs so that jobs and work are created, and so that people regain their ability to make money and spend. So calling the stimulus “loaded with pork” is absolutely moronic.
- Theoretically speaking, the money spent on the stimulus isn’t all “lost” money. It’s not like we bought a car, didn’t insure it, and then crashed it. If the money was invested properly, (big “if”) we would see returns on some of our investments.
Definitions of Pretty Basic Political Terms
All Definitions taken verbatim from Dictionary.com
- Socialism – a theory or system of social organization that advocates the vesting of the ownership and control of the means of production and distribution, of capital, land, etc., in the community as a whole.
- Anarchism – a doctrine urging the abolition of government or governmental restraint as the indispensable condition for full social and political liberty.
- Fascism – a governmental system led by a dictator having complete power, forcibly suppressing opposition and criticism, regimenting all industry, commerce, etc., and emphasizing an aggressive nationalism and often racism.
As you can see, none of these really have anything at all in common. I’ve mentioned this here before, but the Obama-as-the-Joker (who is an anarchist) with the label “socialism” at the bottom, is stunningly moronic.
So, tea-partiers, the point is that you really need to abide by the credo, “know thine enemy.” We on the other side understand you: you just have no clue what you’re actually talking about.
These so called~ “Tea partiers” are only board, racest that are trying to make up some kind of purpose to gripe about to hide the reality that they are truely White Hoods. If they could burn a cross on the White House lawn they would. I AM A WHITE WOMAN that was born in 1964, I HAVE WATCHED THE BLACK AMERICANS TREATED WORSE THAN DOGS MY WHOLE INTIRE LIFE ! The tea parties are only a lenchmob they don’t have a cause.