The numbers we are hearing in the media are astounding and incomprehensible. A billion for this, ten billion for that, how do they decide who gets how much? What does it mean to us? To our children?
Let’s take a moment and put it in “Kitchen Table” terms - illustrate it with a family budget. Let’s say your family takes home 26,600 per year (one ten-millionth of the federal income). But you have been living beyond your means, borrowing money from your credit cards to make up the difference. You owe the credit card companies $106,000 - four years worth of your take home pay. You are still spending 2,400 a year more than you make. And those were the numbers 4 months ago. In the mean time, you borrowed another 8,400 to help an ailing friend (the banking industry). Now, a lender comes to you with a very strange proposition.
What this banker wants you to do is borrow another 8,100. But he has some restrictions. You are not to use the money to pay any other debt, or to buy anything that would increase your net worth (say an investment property or a car). You have to give it away, or use part of it to reduce your income. As a matter of fact, the suggestion is that you reduce your income by 2,000 (the tax cuts that make up 25% of the package). The other 6,000 you have to give away, not pay bills. And you have 2 weeks to figure out where you are going to put that money.
So now, you and your family sit around the table figuring out how to spend that 6,000. You decide to give 5% to the united way, 10% to your church, etc. etc. etc. That is exactly how our lawmakers are deciding how to spend the money in the stimulus bill. They do not even have exact costs for specific projects, in most cases. They just believe that program X is underfunded by some amount, so they write a line giving that program that amount of money.
Some of that money you gave your sick buddy (the banking industry) was used to buy trinkets for his wife instead of going to his bills - because you didn’t tell him he had to pay bills with it, because you had to come up with the money in 2 weeks to help him or he was going to lose his job. Because you did not think it through. And it still has not helped him get back to work.
These are all numbers we can understand. Now, multiply every number by 10,000,000 and it is incomprehensible. That is what our legislators are dealing with right now.
You may believe the United Way and your Church are worthy causes, and they are. But does it make sense to only have 2 weeks to figure out what kind of charity giving is best going to make a dent in the plight of the world? Or what kind of spending programs will “save” our economy? No matter what it is that you believe in, it makes sense that we should step back and think a little more. Be sure what we’re doing is right.
Let me know your thoughts on all that is happening with the Government, the Stimulus, the Economy, and the Real Estate market. I’d love to hear your perspective.