Tuesday, February 3, 2009

Looks 10 Dance 3

My concern about the stimulus package deepens.  As well as my doubts about whether the Obama team is ready for prime time on the issue of the Catastrophe.

What was this team doing during the months before inauguration?  They've had plenty of time to choreograph this act, perhaps the inflection point of the entire drama, and I'm surprised at the lackluster performance to date.  Grade---Dance: 3.

There is no time to lose to address the twin elements of the crisis ---jobs and the credit crunch. And the solution to the latter is inextricable from the former.  So, this is all about jobs and getting money back into consumers pockets so they can spend it and restore the demand for goods and services.  Unless consumers spend, and companies rev up again to meet those demands, the banks have nowhere to lend the money, regardless of the state of their balance sheets.  Econ 101.

The House passed economic recovery package is....well, a disaster.  Let's start over.  We need new leadership on this.  Rahm and Barney and Peloser are exactly wrong in their view that this crisis affords the political opportunity to fund as many cherished Democratic projects as can be reasonably packaged into a spending bill at this time.  No.

Disqualify all spending programs that do not put people immediately to work---directly, and measurably.  Exceptions for funding entitlements and emergency measures to provide health care coverage for the unemployed.

Kill the tax cuts unless they are dollar for dollar rebates on consumer spending in targeted industries.   (Still like my idea of a $5000 per household rebate on new car purchases during the next 18-24 months.)

Kill the long term infrastructure, research, and health care reform projects.  These are second-stage items we might be able to afford if and when economic activity gets back on track.  

Obama & team are getting snookered by Congress on these issues, because they seem ill-prepared.  Geithner is quoted as saying he will have a plan within the next several weeks.  Huh???  This is a day by day action choreography and messaging issue.  Instead, we have Barack signing important (but largely irrelevant) executive orders that are largely beside the point---as meritorious as these actions may be. 

Great rhetoric without a solid action plan to back it up is an empty, meaningless gesture.  Dislike being so harsh, but this team needs to get its act together.  No time to lose.....

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