As The World Economic Crisis Grows...The Lifeguard has been fielding questions about the Brobdingnagian stimulus package offered by President Obama. In many respects, the desire to do something right now has replaced the need for well-reasoned and thoughtful action.
The belief that the Congress--people who have, in the main, done nothing productive for the duration of their working lives--should be the saviours of the world society is a troubling and destructive cult. The posturing, and demagoguery that have filled the news of late is, quite frankly, disgusting and offends the sensibilities of thinking, tax-paying Americans.
Rather than spend like drunken sailors in a Thai whorehouse, Congress (and President Obama) need to take a step back and think about the needs of the many (as opposed to the needs of the few).
The Lifeguard offers a few suggestions to soften the blow of the growing economic malaise:
First, stop thinking that something needs to be done immediately. We didn't get to this point overnight, and we won't have relief upon the signing of the bill (which calls for massive spending in future years). Instead, start by analysing the various sectors needing relief, then work on several small, focused plans (rather than one massive clusterfuck). At least that way, Congress (and, more importantly, the people) will be able to read and understand what is being done, and what is being spent.
The Lifeguard would start with the banking industry, giving money to clean up balance sheets, minimise the impact of bad loans, and to get people saving (and banks lending) once more. Rather than encouraging more bad behaviour (such as people buying more house than they can afford), Congress should accept the fact that some people made bad decisions; and, therefore, should have to down-size (or lose their homes to foreclosure). The reality of life is that not everyone is entitled to live in a McMansion.
Heavy industry should be next (perhaps). Companies, like Caterpillar, will be poised to profit as governments around the world funnel money into infrastructure projects, and will be able to gain ground (and market share) if Congress targets specific industries.
Second, cut taxes (and suspend environmental regulations) that stifle business development. CAFE standards are killing the US automobile industry, and hybrid/alternative fuel vehicles are costly (and potentially environmentally harmful). The General, Ford and Chrysler should be encouraged to start increasing the production of diesel engines (and states like California and Massachusetts should be forced to accept the registration of diesel cars). Allow the Big Three to import their foreign diesels into the US market, without tariff, and set a goal of forty percent of the US fleet to be diesel-powered by 2015. Reduce the taxes on diesel fuel (which will help the transportation industry lower their costs) to encourage the spread of diesel at the pump; and, offer tax relief to Americans who trade in their petrol-powered rides for diesel-powered vehicles.
Let the Big Three sell their diesel-powered Escalades, Navigators, and Durangos (along with smaller diesels), and the industry as a whole will gain traction.
Allow offshore drilling, so that we can become more energy independent; and, eliminate supports for corn and sugar (so that the use of sugar-based ethanol can supplant corn-based ethanol), which will lower food prices (since more corn can go to food production and sugar prices will tumble, allowing for greater reductions in prices of sugar-containing food).
Third, stop fucking with health care. Some people make the choice to eschew health insurance because they are young and healthy. And, while having these folks in the insurance pool helps spread the risk (and reduce premiums for the rest of us), they shouldn't be forced into spending money they don't have (or wish to save). If universal health care is the goal, then allow people to shop, across state lines for the best prices; and, make a chosen policy portable. Allow people to set up HSAs, and allow them to keep the money they don't spend at the end of the year (or let them roll it into their IRAs, without penalty).
(e.g., Company A offers a policy that has a $2,000.00 deductible. The consumer funds the HSA with $2,000.00, via payroll deduction (or out-of-pocket). If, at the end of the year, the consumer has only spent $200.00, allow them to keep, tax free, the remaining balance; or, to roll it into an IRA.)
Also, limit malpractice awards to actual damages. A person who loses a child to a doctor's malpractice simply should not get tens of millions of dollars. In the event of a disability, the award should contemplate the cost of care only; not shit-tonnes of money for pain and suffering. (Senator John Edwards demonstrated throughout his legal career, repeatedly, that juries are unpredictable and driven by emotion, not facts; and, their awards are devastating to the medical community).
Limit malpractice costs and the costs of health care will come down, significantly.
Finally, the government should get out of the business of education (or, at least higher education). As government student loan limits have increased, so has college tuition. Students are leaving colleges with unmanageable debt; and, small colleges and universities that should otherwise close or consolidate are profiting.
Eliminating government aid will do a couple of things, including colleges to knock loose some of their endowments to fund the education of economically challenged students. Colleges will have to compete more aggressively for students who need aid (by reaching into their own pockets). They will also have to freeze (or reduce) salaries for everyone, including administrators, faculty, and union members.
Additionally, getting government out of the student loan business will reduce the administrative burden on secondary and tertiary education providers. Less bureaucratic red tape means less paperwork and fewer paper-pushers.
Finally, consolidation among the 2,300+ four-year American colleges might not be a bad thing. For example, Harvard subsumed Radcliffe. Maybe UMass-Amherst should subsume UMass-Lowell (saving a few hundred grand a year for a second chancellor). And, consolidation within departments should follow. Roll Women's Studies (or African Studies) into Sociology (for example). Get rid of a department head (or ten). Then, pass those savings on to the students.
Next, The Lifeguard gets rid of the Departments of Education, Energy, and Transportation; reduces Congressional salaries by 25%; and, starts Predator flights (along with the attendant Hellfire Missile attacks on drug lords and aliens crossing into the United States illegally).