Obama finally released his stimulus plan overview so we have something other than speculation to review. It seems to be filled with disclaimers about uncertainty and margins of error.
He plans to create 3,675,000 jobs by the end of 2010. Make sure you read the fine print that uses increased working hours and productivity from already employed workers in the jobs created formula. He also predicts an unemployment rate of 7% at the end of 2010. It's 7.2% today nationally. So .2% is an economy saving, job creating stimulus package?
He also predicts the unemployment rate to be the SAME at the end of 2013 whether there is a stimulus package or not, still 7%. How is this a long term job creation program? These are his numbers, not mine. I'm sure we'll hear more than anyone would ever want to about this stimulus package and the details. I just think it can't work very well if it doesn't address the problem.
Obama is using Moody's Corp. as his numbers cruncher to plan his stimulus package. By the way, Warren Buffet owns 20% of Moody's. I wonder who he endorsed? Moody's provides credit ratings for about 40% of the world. I thought we had a problem with global credit and companies investing in the risky mortgage derivative market. A little fishy? Regardless, I don't think I would use them as part of the solution.
The bottom line is we need businesses receiving the help because they will be the job providers and investing in expansion and growing the economy. Reducing corporate tax rates and capital gains taxes are the keys to long term growth, not these short term attempts at fixing it that just increase the taxpayer debt. Is $500 per worker really going to help? Especially if the rumor of just reducing your income tax withholding by a few dollars is true.
Obama gets to spend the remaining $350 billion of the bailout money. The Congressional Budget Office already predicts a $1.19 trillion dollar deficit this year. Obama's stimulus package will tack on at least $775 billion more this year and possibly the next several according to Obama. That's money people can't even comprehend. And all for a stimulus package that will provide the same unemployment in 5 years with or without it? Sorry, not good enough.More to come...