Monday, January 5, 2009

Robin Hood to the rescue!

In the good old days,wealth redistribution was just rich people supporting poor people thru the IRS welfare program.Low income earners could receive tax credits even if they didn't pay in effectively creating a negative income tax system.

Today,Obama is ready to jump right back in with another windfall for these same people even though research has shown 80% of last years recipients didn't spend the money.But that's not enough,he's also creating the same welfare structure for businesses.They have always been left out of these spread the wealth schemes until now.They can write off losses for the previous 5 years and be eligible for various credits as well.

So,is $500 a worker going to reverse the economic slide?Will the 80% that saved it last time spend it this time?I believe I read we lost $6 trillion in stock value in 2008.If 50% of the people spent all of it,would $150 billion reverse a loss 40 times that large?Playing with numbers is fun,but it doesn't translate into a fix.

Nothing new here.Raise taxes on the rich,give money to the poor,spend more taxpayer money on schemes and entitlements,raise the debt.Shifting money between the rich and poor depending on which political party is in power is fine.It's that little spending detail that raises the debt that both parties like to engage in with reckless abandon and why none of these repair jobs will work.More to come...

No comments: