This week the U.S. Senate will continue work on President Bush’s proposed $145 billion economic stimulus package meant to stabilize and possibly invigorate a slumping economy that teeters on the brink of recession.
While some analysts debate as to whether we are already in a recession, or if the specter of inflation is floating over our shoulder, there is little question that we are in serious trouble. This economic bungling has been a long time in the making.
It began with a fundamental shift from a financial strategy that stressed fiscal responsibility on the part of government, toward savings development on the part of the people. What we have today is a fiscal ideology of unrestrained spending by both citizens and government.
Only have $500 in the bank? No problem. You go get that new, shiny SUV. Can’t manage a 20 percent down payment on a house? No worries, this low initial percentage, adjustable-rate, subprime mortgage will get you into the house you always dreamed of but could never afford.
Government has a nasty problem with surplus funds? Easy, we’ll wipe it out with massive tax cuts. Who needs a rainy day fund anyway? It’s not like a war is going to start, or a city could fall victim to a massive natural disaster.
As ridiculous as the examples are, they reflect the reality of our “race to spend” doctrine. The very notion of a savings safety net within which both government and citizens alike could weather a national or financial disaster is never considered. That would impact the unrelenting drive for more, new, better stuff.
The stated purpose of the upcoming stimulus package is to give most single tax payers $600, and couples $1,200. The money really is not for you, but so that you can go cash the check and hand the money to someone else. This process of money changing hands is intended to stimulate business and growth; and this in turn is intended to provide more stability and job security for the American worker.
That most American’s could not survive being unemployed for two months on what they have in their savings is irrelevant, we have credit for that. The race to spend is all that matters here, and the government and big businesses want you in the running.
But before we lace up our shoes, we should ask what the prize at the finish really is.
Our national debt is more than $4 trillion, we have outrageous housing costs (median home price in California is $600,000) and we are straddled by skyrocketing food prices (in some places a gallon of milk is $5).
It would seem that the only thing we can hope to win is the booby prize: A country where only the very well off can really afford anything. A fiscal ideology devoid of stressing the need to develop financial security is unhealthy at best and very dangerous at worst.
I agree (in part) with some of the material presented in the three-volume “Histoire du XXe si�cle,” which states “Economic growth imposes a hectic form of life, producing over work, stress, nervous depression, cardiovascular disease, and according to some, even the development of cancer.”
While I do not advocate the abandonment of the policy of promoting economic growth and development, I do question this overt desire for a breakneck pace in which to develop it. We have been running this marathon for hundreds of years. We will do so for many hundreds more. We can afford to slow down and inject the precept of committing to save on both a national and individual level into our fiscal policy.
The emergence of a national mindset that places more value on the health, happiness and security of the individual and society rather than the newest game controller, larger SUV or that huge house at the end of the cul-de-sac, is to me, truly a prize worth winning.
Kulhanek is a senior studying paralegal studies and administrative justice.