Recovery is a State of Mind


With President Obama and Vice President Joe Biden going all over the world telling everyone how their excessive spending has brought our economy “back from the brink” of a depression, I thought it might be nice to see where those dollars are actually being spent and how much is being spent in my county in Georgia. 

The website www.recovery.org is a great resource for this.  The site shows a map of the US with how much money is being spent in each state, and, if you click on the state, you can see a list of the projects that have been awarded so far to that locality, along with how many jobs the White House Council of Economic Advisers says will be created (or saved I suppose, but the site doesn’t differentiate.)

What I find most interesting is that all of the projects in my county are ecological studies and road projects.  These things are done by the US Forestry Service and the Department of Transportation.  Now, I’ll admit I don’ t know how those organizations employ people.  I will assume that they will need to hire contract labor to do the work, and this will create private sector jobs.  Again, the site doesn’t differentiate on how the jobs are created between private and public sector jobs, but at first glance, it looks like all the jobs are government jobs.  And people will only qualify for those jobs if they have skills working with park rangers or pouring concrete and holding signs that say “SLOW.”  I have always presumed that the signs are advising drivers to drive slowly, but it could also be describing the neanderthal holding the sign.  I don’t know.  Just saying…

How effective has all this spending been at creating jobs?  Uneployment continues to climb, up to 10.4% last month.  Businesses are cutting jobs to try to stay afloat while the president ridicules them for “sitting on the sidelines” (from an interview with Fox News’ White House correspondent Major Garrett.)  Businesses are also holding on to their money when it comes to expansion and hiring, and are waiting to spend money on projects until the last possible minute (the industry I work in sees this.)  Large capital expenditures are being put off until companies are in a better financial state. All of these things point to a continued slowdown, not economic recovery. 

I guess we need to examine what recovery is.  Recession is defined as negative growth in GDP for two consecutive quarters.  This means the economy is shrinking as measured by output of all businesses in the US.  Less output means lower revenue, which means less expansion of business, which leads to further contraction, and so on.  All of this assumes the business environment is unaltered by taxes, imports, banking issues and the like.  So, recovery would mean that the GDP is either getting less negative or growing.  With businesses still cutting back on expenses, that wouldn’t appear to be the case, now would it?  The only business that seems to be hiring right now is government. 

Many economists have said the steps taken by the Obama White House will actually cause the recession to deepen next year.  After the holidays, when people typically buy stuff they can’t afford and don’t really need, which helps the economy, people will tighten their belts even more, presumably to pay off their credit card bills.  Companies will see this in the form of even further reduced revenue, which will cause the cycle to deepen further. 

Government could learn a thing or two from all this.  Instead of spending money on projects that don’t create any real jobs, maybe they should tightnen their belt and cut back on spending.  If you have a revenue problem, you can’t really solve it by borrowing more money then spending it on crap you don’t need.  Sure, SR 60 would be a better road if it were wider, but do we NEED that RIGHT NOW?  And, once the job is done, whomever was unemployed before the project will be unemployed again.  Probably sometime in the spring. 

The actions taken so far by the Obama Administration is not pushing America toward recovery, much less actually providing true recovery.  It’s all an artificial recovery, made up by the people who want it to be that way.  The Obama White House has said that over a million new jobs have been “saved or created” by the stimulus package.  These jobs include over 400 jobs for teachers in Washington state, in a school system that only has about 240 teachers.  It also includes jobs in Arizona’s 86th congressional district.  Except that Arizona only has 8 districts.  It’s all made up.  Fake.  Imaginary.  The truth is that this “stimulus” hasn’t done any of what the president promised, and we are furhter in debt to the Red Chinese than ever. 

Recovery will come when the private sector is allowed to weed out weak companies and the fear of government interference is reduced.  When tax laws are changed to allow companies to keep money to reinvest in their businesses.  When business owners aren’t forced by government to buy healthcare insurance for their employees or face being shut down by government penalties and fees. 

But, I guess, if you are in Obama’s White House, all you need to do is click your heels three times and wish, and it will be so.  That’s how Obama won the White House, after all.  Just make up a recovery.  Say the recession is over, and it’s magically over.  In this way, recovery really is a state of mind.

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