Call It Whatever You Please

It’s not about what it is called

Call it Whatever You Please

The US Economy leads the world’s economy. The US boasts a Gross Domestic Product of about $14 trillion dollars. China, with a population in excess of 1.3 billion, only produces a GDP of $10 trillion dollars. Not bad, when we only have 22% of China’s population.

Nevertheless, our economy’s problems are systemic.

It is estimated that China and Japan have $2 trillion dollars in reserve, but the US has a national debt of almost $9.2 trillion. In October, Congress raised the debt ceiling to $9.815 trillion, the fifth time since 2001.

We owe Japan $600 million and China $400 million. My second grader now owes $30,000 in US debt.

No matter what your current senator, the Republican Party or Fox News tells you; the US economy has dire problems.

The US economy is in an unusual period of economic weakness. We are realizing an economic slowdown. If we are not already in a recession, we at least have a far greater risk of entering one.

In the future, the prospect of economic growth is not good. These statements can be attributed to Dr. Peter Oszag, Director of the Congressional Budget Office.

According to Harry Paulsen, the US Treasury Secretary, “time is of the essence…we need to help families through this tough economic period.”

Consumer spending was down during the Christmas season. The Federal Reserves emergency interest rate cut of 3/ 4 of 1% was the first out-of-session rate cut since the days following 9-11 and the biggest rate cut in almost 25 years (October 1984).

The Fed rate cut further weakens the US dollar. Many households are having significant fiscal distress. The world’s financial markets are in turmoil. The oil prices are a problem and there are the impending $600 billion mortgage rate resets on the horizon.

So what do we do? Issue more food stamps. That’s right, your government’s short-term economic stimulus plan, is to bolster our great US economy by issuing more food stamps and expanding unemployment benefits. Or we could issues tax rebates like those in 2001. However, if done today at the $800-$1600 per household amount, they would not be issued until June or July - stimulating the economy around Christmas of 2008 - too late.

The corporate accelerated depreciation plan of 2002-2003 did not produce like was expected. And don’t forget the Bush tax cuts, which are still out there. Always looking for the new scheme, never the Cure.

Have we reached a point in our US History that to stabilize the economy we issue more food stamps and increase more unemployment benefits with borrowed money, which only increases our deficit? Where is our strong industry? Where is our manufacturing base? Where are our strong exports with our strong trade policies? Where is our strong, well-paid workforce? They exist, but only in foreign lands.

The US economy MUST have revolutionary changes to right its ship.

The US economy cannot operate any longer on quick fixes, short-term solutions and temporary tax cuts. We need a bold, new direction with substantive change. We must replace the IRS code with the FairTax. We must restructure all our trade agreements. We must close the door to foreign workers both legal and illegal, which will raise wages and put the American middle class back to work. The only way to accomplish these goals - New Direction with New Leadership.