Saturday, February 16, 2008

Tax Stimulus is Steroids for the Economy

Move over Roger Clemens, Congress has taken a lesson from “The Rocket” by injecting an artificial stimulus (tax rebate) into the economy. Lowering interest rates to provide cheap credit wasn’t enough of a stimulus, so this administration has given us a direct hit into the vein, sending cash right into the consumers pocket with instructions to spend it pronto.

It seems a little ironic, but as Congress shows their dismay and disappointment with Roger for using steroids to pump up his performance, they follow his lead to artificially stimulate the economy. Everyone cheered as Roger was pumping up and winning seven Cy Young awards, while ignoring the unnatural physical changes – see Roger’s physique when he entered the league (Photo on right) as compared to more recently (below).

The doping of the economy has been going on for a long time with the administration cheering the growth of the GDP. It was growth at any cost. Who cares about trade deficits, dollar devaluation, inflationary prices, skyrocketing home prices? Cheap and easy credit was the mantra.

This stimulus package is a temporary fix, another quick high, that will increase inflation and fall short of fixing anything. It’s time to cut the junkie off and let the natural market forces go to work. Instead of giving consumers more juice, congress should ask them to live and play within their means. The withdrawal symptoms (a recession) will be excruciating for those speculators and victims of rate scams, but it’s the only way to allow the free market to wring out all of the bad debt and begin the healing process.

1 comment:

  1. While I agree that steroids makes a fine analogy to the stimulus, I think the analogy works better as a comparison to greed in this economy. Greed is what has inflated our economy and continues to threaten our freedoms. Greed is not limited to just a few at the top of the corporate latter. It trickles down into the middle class and the poor. When we try to live beyond our means or feel we're entitled to money we didn't earn, we're contributing to the demise. I referred to your article here and posted my own hypothesis to a similar metaphor. I'd love to get your thoughts.