The trillion dollar hole

Yesterday the deficit reached one trillion dollars. That is a staggering sum of red ink. In fact it is so staggering that it should make us all take a minute to grasp: a one with twelve zeros amazing. And people are understandably upset, i know I am! But i am not upset with the red ink the wars that we are in are the basis of the reason we had to spend the money in the first place. The swindlers in the finance field, the auto industry (who made bad cars) the loans given to people who could not pay their obligations and who face foreclosure; all of these issues created this mind boggling amount of money.

Conservatives (here we go again) are blasting on radio in the Halls of Congress the Obama Administration for this state of affairs, and to be fair they should!! This is Obama's mess to deal with and to blame Bush lite for ever is not going to solve the problems. The question you ask is why blame Obama? After all he has been in office less than a year. The issues were not of his making (except he as well as other officials voted for these measures) So why then be angry with him? The reason is easy in the beginning The administration had difficult choices to make: They could have let AIG, General Motors and the rest of the banks fail. That is correct fail. This means no bail out at all. The price for doing business as usual should be to go out of business. Absolutely. There would be consequences: cars would loose value, guess what they have already; there would be a glut of houses on the market with no buyers, there are still plenty of houses available, and yes there would be a shake up of the markets world wide. The confidence in institutions would be shaken as it must be, because only then would real change come. To continue with band aids is counter productive and it is not the best course for our Nation and world economies. In time we will feel the pressure and there will be no more relief available.

What is the answer to these realities? I think had the current administration faced the fact that any stimulus was not going to work (and it may we never know) and swallowed this ink while painful to the economy with job loss, contractions and world wide upheaval, in the short term a correction would have been made. Unemployment would have risen to levels as they did in the Great Depression and the misery index would have been unbearable, but, in the long run with a clear vision stimulating the economy might have been easier. This condition makes it harder to rationalize why we spent money in the first place. However, political will being as it is, the decisions made were all the cowards in Washington could muster. Later