Rubber Checks

April 30, 2008 in Politics | 7 comments

So, what do you do if your bank account stands at -$9,337,515,818,138.53? Well, if you’re the federal government, you clearly write checks for another $150 billion, just for kicks.

  1. t.w on June 9, 2009 at 8:37 am

    Well, as far as I know, the Iraq War is mostly responsible for the unprecedented deficit. You seem not to have seen the real cause behind that.

    I see Pelosi’s “recovery rebate” a good way to stimuate domestic consumption and eventually America’s economy. What’s wrong with that?

  2. t.w on June 9, 2009 at 8:40 am

    Englighten me if you can.

    I don’t understand why some conservative Christains line up with Republicans and turn a blind eye toward outside their own concerns.

  3. Jordan on June 9, 2009 at 8:45 am

    t.w., I would have been incensed with this bill whether Republicans or Democrats passed it. The problem is that the money for this can’t come out of thin air. When the government borrows money, it has to pay for it eventually by either raising taxes or devaluing its currency. It’s like trying to raise the level of water in a swimming pool by taking water out of one end with a bucket and dumping it in the other end (spilling some on the way). It is impossible for this to result in a net gain to the economy, and will actually end up hurting taxpayers and savers.

  4. t.w on June 9, 2009 at 8:36 pm

    I would disagree with your analogy of the swimming pool. Money has to flow in order to generate profits and benefits. Improved domestic consumption will stimulate the industrial and commerical base.

    What in your opinion Congress should do in this case?

    By the way, I found your site from a hack you posted on tarski forum. It is about aligning sidebars with the post.

  5. t.w on June 9, 2009 at 8:39 pm

    Sorry to ask here an off-topic question:

    How did you make the header image link to your site? By default, tarski does not seem to hyperlink the header image to anywhere.

    Also, your posts ‘1 million dollar’ and ‘And Then There Were Four’ do not show any post content on my Firefox browswer.

  6. Jordan on June 9, 2009 at 8:50 pm

    Congress should do the one thing they seem incapable of: nothing.

    I agree that money has to flow in order to generate profits and benefits, but the government is the least efficient body to make that happen. For every dollar Congress spends, a dollar is taken out of private hands. This may not happen immediately, but it has to happen eventually, either by taxation or by inflation. The seen benefit is that Congress is writing checks, but the hidden cost is the loss of everything that would have been done with that money in the private sector.

    The problem is, when Congress spends money, it doesn’t do so in the most productive way. Congress has no incentive to “get the most for its money”, as a private party would. In fact, more attention is paid to the dollars spent and jobs “created” than what is actually being accomplished.

    I would recommend reading the book Economics In One Lesson for a much clearer explanation of this idea. You can get the PDF for free online.

  7. Jordan on June 9, 2009 at 8:55 pm

    I’m not sure about the header link… I’m using Tarski 2.4. I don’t think I did anything special to make the image link. Perhaps hiding the blog title and tagline makes the image link?

    What version of Firefox and OS are you using? Those two posts embed YouTube videos. Perhaps you have Flash blocked?