No details of the plan are available so it can not be said how much of this will contribute to the federal budget deficit. Obama has promised to roll back Bush tax cuts for the rich, but when that will happen and whether it will be enough to cover the bill are unknown.
Today we also hear that the Bush administration will bail out Citigroup, the latest in a line of financial institutions to be saved from the brink of insolvency.
Obviously, this nation has not seen this type of corporate chaos since the Great Depression, when the government spent more than a decade bailing out banks and corporations. Possibly the big difference here will be in the method in which these bailouts are payed for.
During the Great Depression, the government raised taxes very sharply and especially on the rich to help pay for the bailouts. This time around, so far, the corporate dole-outs are being paid for 100% by growing the national debt.
Obama Eyes $500 Billion in Stimulus; Paulson Weighs Ramping Up Aid ...
New York Daily News
Wall Street Journal -1 hour ago
By JONATHAN WEISMAN, DEBORAH SOLOMON, and JON HILSENRATH Aides to President-elect Barack Obama and President George W. Bush are rushing to craft measures to shore up financial markets and prevent a policy vacuum from further harming the economy during ...
Ahead of the Bell: Slow impact seen in stimulusCNNMoney.com
House leaders clash over economic stimulusMarketWatch The Associated Press -New York Times -Reuters -Forbes
Obama economic team
2 comments:
With all this press about various rescue plans, I have seen little comment about Obama's extraordinarily disappointing statement that he is reneging on his oft repeated campaign promise to roll back the tax cuts for the very wealthy to the Reagan era cuts. He justified this most eloquently and clearly, as well as standing clear about keeping his campaign pledges. Obama's knows better, and his seeming willingness to capitulate on this is most disillusioning.
Going back to the 1994 tax standards is not "raising taxes during an economic crisis." It is a small step toward creating a little more balance between the super rich and the rest of us about whom the Bush administration cared so little.
Yeah, Obama has fallen into the 'supply side economics' argument that dominated U.S. politics since Reagan that got us into this crisis. Taxing the super rich will NOT hurt the current economy. Decades of damage will not be undone by one or two stimulus plans. There is serious restructing of the economy that is needed.
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