File photo from June 2006 interview. (Brad Warthen)
There are two schools of thought about what would happen if Mark Sanford were to resign. The first, held by my former co-workers at The State and a number of politicians who feared the consequences were the governor to be impeached, hold that being installed as interim governor would give Andre Bauer a leg up in becoming governor for the next five years.
The Optimist School, to which I am a leading adherent, holds that a year of being governor would have subjected Mr. Bauer to a level of scrutiny that would ensure that he were not elected to anything in the future. As lt. gov. he is almost invisible, and has to do something spectacular, such as rush at a police officer during a traffic stop or crash an airplane, to be noticed. As governor, particularly after the events of recent months (which seems to have awakened the press in SC into thinking, Hey, we’d better actually COVER the governor!), he would be subjected to so much light that his political hopes would evaporate.
Today, we have some fresh evidence supporting my position. Now that he’s a candidate for governor, he is being watched a LITTLE more closely than usual — not as closely as if he were governor, but closely enough that the press picked up on this:
GREENVILLE – Lt. Gov. Andre Bauer has compared giving people government assistance to “feeding stray animals.”
Bauer, who is running for the Republican nomination for governor, made his remarks during a town hall meeting in Fountain Inn that included state lawmakers and about 115 residents.
“My grandmother was not a highly educated woman, but she told me as a small child to quit feeding stray animals. You know why? Because they breed. You’re facilitating the problem if you give an animal or a person ample food supply. They will reproduce, especially ones that don’t think too much further than that. And so what you’ve got to do is you’ve got to curtail that type of behavior. They don’t know any better,” Bauer said.
In South Carolina, 58 percent of students participate in the free and reduced-price lunch program.
Bauer’s remarks came during a speech in which he said government should take away assistance if those receiving help didn’t pass drug tests or attend parent-teacher conferences or PTA meetings if their children were receiving free and reduced-price lunches.
Bauer later Friday told The Greenville News he wasn’t saying people on government assistance “were animals or anything else.”…
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Interesting journalistic sidenote: The headline in the paper I got at home said “Bauer: Helping needy like ‘feeding stray animals’,” as opposed to the relatively innocuous online version linked above, “Bauer: Needy ‘owe something back’ for aid.” Had I seen the latter one first, I may not have been drawn into reading the story. Actually, I probably would have been, but I imagine a lot of readers less interested in politics would not have.
Agree with your headline observation. I was interested enough by the online one to read the story, but really was not expecting granny’s wisdom to lead where it did. Perhaps one thing to be grateful for regarding Andre is that he has not been breeding.
Sunshine. Mr. Bauer just needs more of it.
Spot on, Brad.
Love the file photo, too. Little Andre kinda looks like a stray that needs to be fed.
Actually, if I remember correctly, that was shortly after his plane crash. His crutches were on a seat next to him, and he was somewhat the worse for wear…
I have now lost any ability to defend Andre as possibly not so bad as we thought. He actually wants to take the lunches away from kids whose parents don’t attend PTA meetings. Not to mention taking them away from kids whose parents test positive for drugs (you’d mostly get marijuana btunless the parents were really hard-core since the excretion rate for the ones we’d really get upset about, like crack is fairly rapid)–these are the kids who REALLY need lunches, since they probably get very little nutrition at home.
Not to mention his most ridiculous analysis that schools whose pupils get more subsidized lunches don’t do as well on tests–yes, this is true, in fact you could probably even track it pupil by pupil–wonder why that is so? You think it has anything to do with the fact that kids who get subsidized lunches have fewer advantages when they get home, too?
FAIL
Note that Vincent Sheheen is getting all over Andre for his comments…
I doubt that Bauer will be the candidate of the republican party for governor.
If he is I hope we will all vote for the democrats
Andre isn’t old enough to remember fellow students sitting without food and watching classmates eat lunch because their parents didn’t pay the cafeteria bill or send a lunch. (Did he even attend public school?) I’m not old enough to remember it either but my sister does, and although none of her 4 children have ever received reduced or free lunch she will fight to keep it available for others because of those memories.
I work in public schools and it is not an uncommon sight to see some students lick clean their lunch trays.
While I support efforts to increase personal responsibility and decrease abuse of taxpayer subsidies it seems as if Andre’s solutions punish children for parental irresponsibility. There must be a better way.
Well, the Democrat probably has my vote. That’s one.
Bauer never said anything about taking food from children, nor did he compare the needy to stray animals. He simply said welfare benefits should be taken away from lazy recipients who won’t even lift a finger to help themselves or their children. And the American taxpayers agree with him.
Follow the link to his actual statement and you’ll see for yourself. Let your viewers and readers hear his exact words as they were spoken — rather than selections taken out of context — by clicking http://www.greenvilleonline.com/ which loads the Greenville News homepage. Please scroll down, looking on the right side, until you see Latest Videos and his name. Clicking his picture will allow you to listen to his remarks, which lasted almost three minutes.
Another route would be to click here: Bauer audio file from town hall
Andre Bauer offers additional comments on “breeding a culture of dependency”
“Big difference between being truly needy and truly lazy”
At a forum this week, I spoke out in favor of finding ways to break the government’s cycle of handouts and dependency.
Yes, I believe government is “breeding a culture of dependency” which has grown out of control, and frankly, amounts to little more than socialism, paid for by hard-working, tax-paying families… against their wishes.
At the same time, I feel strongly that we can and should help our neighbors who are truly needy. In fact, I’ve spent much of my last seven years helping those in need… traveling the state to help provide blankets, shoes, food, and health care to those who need it most.
However, there’s a big difference between being truly needy and truly lazy.
My suggestion to require parents of children who receive free lunches to attend parent-teacher conferences is simply a common-sense idea to help break the cycle of dependency, while at the same time providing a better education and a brighter future for the children affected.
Requiring drug testing for adults receiving tax-funded benefits is also just good, plain, common sense.
Yes, I am speaking out for such requirements, even though they may be “politically incorrect” in the eyes of the news media. It’s better for the children, it’s better for the taxpayers, and, in the end, offering a hand up instead of a hand out will be better for those who have become taxpayer dependents.
Americans are a compassionate people who will always help their brothers who are truly in need. But we cannot and will not allow those who are simply “riding the system” to continue to do so without consequence.
Warren Buffet once said, “No one washes a rental car.” He’s right. We must find ways to instill some sense of responsibility or consequence into those who are now a part of the cycle of automatic hand-outs.
Generational welfare is bad for the people on it and bad for the state of South Carolina.
Hear my exact words as they were spoken — rather than selections taken out of context — by clicking http://www.greenvilleonline.com/ which loads the Greenville News homepage. Please scroll down, looking on the right side, until you see Latest Videos and my name. Clicking my picture will allow you to listen to my remarks, which lasted almost three minutes.
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Frank, perhaps you should listen to the very podcast you recommended to others. Indeed Bauer talks about taking food away from kids. “If you receive goods and services from the state and you don’t attend the PTA meeting, bam there’s a repricussion.”
The pitifully simplistic analysis that poverty is some how associated with “lazyness” is clumsy and reckless at best. There are many working poor. In fact, there are employed people who are homeless. Children’s Garden cares for many kids of parents who spend their day looking for or working a job.
Bauer’s positon on the relationship between the proportion of a school receiving free and reduced and his recommendation of withholding these subsidized meals is almost as stunning as his comparison of these humans and animals being provided food and reproducing. Frank, your effort to defend this would be laughable except for the fact that there are others who would actually take you and Bauer seriously.
Yes, we need to stop the automatic cycle of handouts. We can start with banks that make risky investments, real estate agents who push to have taxes eliminated so they can sell more houses, and farmers who collect more than a quarter million a year in federal subsidies — plentiful in every SC county.
I am aghast. Amazed and horrified. Ashamed that South Carolinians would elect to office a person so callous, so insulated, so ignorant.
Andre has put this statement into practice with my personal pleas for help from his office.
He is serious folks. He thinks only banks and car companies and governments should get government tax payer assistance.
When people hear my story, I literally watch their hair curl.
For the record, The State, SAT on my story and refuses to confront public officials with the hard copy evidence that is available.
We have some very bad things going on in this state.
It clearly looks as though Bauer completely has turned a blind eye and deaf ear towards a major issue that affects every citizen.
I just happen to be a citizen with the absolute proof.
No one should vote for this manchild.
Frank, Mr. Bauer said that he would require the parents of children who got subsidized meals to attend PTA meetings. What’s he planning to do if they don’t? Force them there at gunpoint? Or stop subsidizing meals? Or possibly take away any other welfare the family gets, thereby assuring that those children don’t get fed anywhere else? And if you do get the parent(s) there, how do you ‘force’ them to actually participate or to participate constructively? No, I don’t think this is the answer, nor do I think Mr. Bauer has any concept of the problems facing those children or adults.
When I read this post, I began composing a comment in my head. KP beat me to it. My thoughts exactly.
Bauer chose a poor analogy for and a misplaced, trivial example of the culture of entitlement that is pervasive in our society.
Even as a Libertarian, I think the government can be the most effective mechanism to make sure that no citizen ever goes hungry. That’s one of the very few things it should do.
Giving poor kids food is a good thing.
It would have been better for Bauer to talk about the broken Social Security and Medicare systems instead as they are far more wasteful and have created an unsustainable pyramid scheme full of people who think the government owes them something for nothing. But he can’t do that because one of his keys to winning the governor’s seat is getting the votes of the elderly. Let’s see if someone will get him to go on the record about how he feels about Social Security and Medicare.
Okay, we can all, I hope agree, that people who are out-of-work can usually attend parent-teacher conferences or PTA meetings….unless they don’t have transportation — oh yeah…or childcare for their other children — oh yeah….or are disabled–oh yeah…
The thing is, Andre has hit on one real issue: there are people who are, for whatever reason, stuck in the “underclass”– not frictionally unemployed but more or less permanently so. They do drugs. They can’t pass drug tests. They have huge TVs in their otherwise squalid homes. They have expensive cable/satellite service and their kids wear rags and there’s no toilet paper in the house (a great way to investigate when you are a guardian ad litem, is to use the bathroom–if you dare). If there’s food in the house, it’s sugary starch. You don’t have to spend a lot of time around DSS cases to see parents who just flat out won’t care for their kids to any significant extent–won’t do things that seem to be so easy and yet so crucial to us, like attending parent-teacher conferences, even when they have good transportation and child care and no health issues. They just won’t do what they ought to, as any reasonable person might see it. With government subsidies, they do provide basic housing, food and clothing for their children, and maybe even some supervision— nothing arises to the level of statutory neglect. They won’t get jobs–even if one is offered to them for which they are qualified and not disqualified, they can’t seem to keep it. So what do we do — starve their children? Take them away and put them in foster care–or terminate parental rights? Even if it were lawful to do so, are we better off either in terms of social outcome or even in terms of financial outlay?
Withholding lunch from the kids in the most desperate homes is no way to break that cycle of desperation. Thank God we offer them breakfast, too!
I’m truly sorry Andre had to have a reduced price lunch ticket that he felt stigmatized him–perhaps we should ban divorce as well–it impoverishes many children.
In terms of “thought it through” as opposed to “sounds great to my base,” Andre’s remarks, even stripped of references to stray animals, belie a cruelly ill considered policy.
Doug, that’s a good one — after all the trouble Andre’s gone to courting the old-people vote, the idea of him going after Social Security and Medicare… oh, boy.
And Kathryn, “frictionally unemployed?” I like that. As in, my unemployment is rubbing me raw…
My husband was once one of those “stray animals” which Bauer says should have been starved to death. He grew up in abject poverty and received government assistance. He worked his way through college loading UPS trucks at night, graduated from medical school and completed a three-year residency in anesthesiology. He’s been a practicing physician for almost 30 years and he has gone to Third World countries and provided humanitarian medical care to other STRAY ANIMALS.
Bauer’s equating of poor human beings to stray animals is the height of immorality.
He should be ashamed of himself.
http://economics.about.com/od/termsbeginningwithf/g/frictional_unemployment.htm
as opposed to structural unemployment, which may be where you’re at, alas
Doug, you appear to characterize this as a reasonable person who simply misspoke. Words matter. They reflect thoughts and perspective. Demagoguery, eerily similar to Palin’s “real America” and Reagan’s welfare queen and Philadelphia, Mississippi speech, is the strategy. I believe it’s racial in nature as well. In SC (and Mississippi) welfare certainly is correlated with the African-American population.
What’s next for Bauer, campaigning at the all white basketball league in Georgia?
“They won’t get jobs–even if one is offered to them for which they are qualified and not disqualified, they can’t seem to keep it. So what do we do — starve their children? Take them away and put them in foster care–or terminate parental rights?”
Perhaps Mr. Bauer will suggest a neuter-and-release program like they have for feral cats.
Actually, a lot of these parents are working 2 or 3 minimum wage jobs, and can’t be at PTA meetings because they are overwhelmingly busy working, or caring for other children. Some of these ‘lazy’ people are vets suffering from PTSD, or schizophrenics who can’t keep their world together. And to top it off, I don’t think we give welfare to anyone who is not caring for dependent children.
Brad, just a curious question. Would you be officially classified as unemployed since you do free lance work? If not, then the official unemployment figure way understates the tragedy of the recession.
Bud, since I am not getting unemployment checks, I assume I am not counted. I stopped getting the checks (I only got three or four of them) when I decided to take early “retirement.” That means I get a pension equal to about one-seventh of my former pay.
I almost feel bad for Andre — which is hard given how much I dislike him — because, due to his clumsy words, some people are going to say he is saying the impoverished are stray animals or that we should get rid of programs like free and reduced lunch. But he didn’t say that. He only said that PTA meeting attendance and drug testing should be a requirement to get assistance and that some government assistance is rewarding bad behavior.
Of course he’s wrong on that. There are many practical reasons why requiring drug testing or PTA attendance is bad policy as others have pointed out. But some are too quick to jump from “Andre is wrong” to “Andre is evil.” People sure do love to feign outrage.
And to those who would say “well, Andre’s lost my vote”, I have to ask; you were really considering voting for this guy in the first place? I hope not.
“I assume I am not counted”
Brad, don’t you think it’s time to stop calling yourself unemployed? Big difference between being truly unemployed versus being self-employed without benefits.
Obama may have made a serious political mistake by focusing on healthcare before completing his work on the unemployment front. Sure he could have and should have done both but at the end of the day both were botched. The various stimulus efforts did improve what would have been a much worse situation but they weren’t enough to bring unemployment down. The big concern right now is a double-dip recession.
Libb, I appreciate your point, but no, I’m still unemployed. I’m using another measurement for that, which is that I’m still looking avidly. I have another job interview tomorrow, in fact.
And come to think of it, I MIGHT still be counted, because there’s a guy with Employment Security who keeps passing me tips when he runs across them, because he knows I’m looking. I’m just not on the dole.
I hesitate to go into this much detail — I’m enough of a Southern gentleman to consider speaking of such things to be tacky — but the fact is that so far, I MIGHT make as much freelancing in a given month to equal the same amount as my pension, which gets me to TWO-sevenths of what I consider to be full employment, pay-wise. Also, the consulting work isn’t exactly employing all my available time, as you can see from my multiple posts most weekdays. So I have a long way to go to being fully employed in terms of time as well.
I’m just getting started with this consulting stuff, and I’m doing it with a divided mind, because so much of my attention is devoted to job-hunting. I really think the potential is there — or will be there, as the economy warms up — to make decent pay doing this. But I still wouldn’t have benefits, and I must have those. We all must have benefits, but because of things we’ve been through in my family, I’m more aware of that than most people are.
So basically, I continue to operate on a number of tracks: I freelance, for a little bit of money to supplement my tiny pension, I search for a full-time job with bennies, and I keep myself out in front of the world via this blog and other activities (which occasionally yields promising job tips). And we’re also working hard to try to sell our house, which FEELS like a full-time job.
And I consider myself to be a sort of bellwether on unemployment, because the same economic forces that are causing others to have trouble finding a job are affecting me. I probably would have found something good (full-time, benefits, good fit for my qualifications) in the first week or so that I left the paper, but so many potential employers are just hanging back, waiting for things to warm back up.
Brad, your situation sounds like UNDERemployed rather than UNemployed. Millions are in that boat. Just another sign of a deep long recession. We need another stimulus.
Yeah… and if I had an actual JOB working full-time for inadequate pay and bennies I would probably call in “underemployed” (although probably not publicly, since I’d want to KEEP that job). But since I’m still looking for a job, period, I use the other term. And if I’m only underemployed, I’m WAY underemployed…
Bud,
Why don’t we just shake the magic money tree and watch all the dollars rain down upon us? Who is going to pay for all these stimulus deficit trillions
? Why doesn’t every American just max out his credit cards? It would have the same effect but then everyone would be on the hook to pay his share… Instead of some of us paying for everyone
Why doesn’t every American just max out his credit cards? It would have the same effect but then everyone would be on the hook to pay his share.
-Doug
Personal debt is not the answer. That’s how we got into this mess to start with. Government spending is fundamentally different from personal debt spending. Look at WW II. There was serious spending going on for that. And it had the profound effect of stimulating the economy to end the great deprssion. The growth that followed in the 50s and 60s was easily enough to pay off the war debt.
We’re in a similar, yet not as dire, situation today. Consumers are not spending and are in fact paying down debt. Businesses aren’t either mainly because of the lack of demand but also because of difficult credit problems. That leaves government as the engine to pull us out of the economic morass. It makes no sense for government to do anything but spend, and spend like crazy. If there are no bridges that need replacing then tear down a perfectly good bridge and re-build it. Landscape the DC mall. Spend lavishly on pet projects. But spend and do it now. That way folks will need to be hired who will then have money to spend. That extra demand will drive up sales which will in turn prompt businesses to hire folks and buy capital goods.
The libertarin/GOP approach of simply waiting for the markets to recover is foolhardy. Didn’t work in 1930 and won’t work in 2010.
My low-paying full-time job keeps me from earning real money.
If you put people to work, and pay them for it, they will spend that money in businesses that otherwise might put more people out of work, etc. The people who work at those businesses will, instead of collecting paltry unemployment, go and spend their wages….The Multiplier Effect. Obviously Doug and others of his ilk (isn’t that a red flag for brad–“ilk”) don’t believe this.
What pray tell would you do, Doug, if you were President, to get us out of this mess, or would you just wait it out while Hoovervilles crop up?
Brad, on your situation, I think it’s partially a matter of self-definition. Since I got hustled into early retirement, I don’t consider myself “unemployed.” I work full time, picking up money in whatever way I can. I tell people, “I’m still working. Sometimes I make money, sometimes I don’t.”
Bud,
With all due respect, your plan is insane. Deficits have to be paid back someday. You either have to raise taxas or else print more money. We are already on track to see high inflation in the next few years. Your plan would destroy the economy. Which I guess is the only way we can fix the problem of top much government spending. Even Harry Reid got on board with cutting deficits today by adding a pay as you go amendment to the debt ceiling bill. Guess Harry knows his days are numbered unless he pretends to be a conservative.
Spending money you don’t have is a recipe for disaster. And FYI we’ve never tried libertarian fiscal policies. Both parties spend, spend, spend.
Why don’t we just shake the magic money tree and watch all the dollars rain down upon us? Who is going to pay for all these stimulus deficit trillions?
Recessions cause great deficits too due to sharp decreases in revenue. So I don’t think it’s that simple that we should avoid stimulus spending in the name of reducing deficits. If stimulus spending can shorten a recession, then that would be good for treating our deficit.
Doud, we did try the libertarian approach in the early 30s – “rugged indidualism” as prescribed by Hoover. The economy cratered. FDR spent and the GDP skyrocketed BEFORE WW2.
It’s amazing how smart people can just extrapolate how things turned out with the Depression and automatically assume that they know exactly how to handle this recession.
It’s a completely different situation. The entire economic system and the way that the government collects and spends money is different now. There are trillions of interconnected transactions that are all impacted by decisions made by consumers, the government, etc. Nobody knows for sure what brought the U.S. out of the Depression. To blindly just state that “this is what worked before” is ridiculous and intellectually lazy.
Now, as for Kathryn’s “idea” that all you have to do is put people to work and pay them and all the problems are solved – same thing. It’s like fortune cookie analysis. How do you put people to work and pay them? What jobs do you want them to do? Where does the money come from to pay them? (I know, THE GOVERNMENT). Why don’t we just pay everyone who doesn’t have a job $50,000 a year to sit at home and surf the internet? According to your theory, that would solve the problem. It’s not about being productive, working hard, or providing a service that people want, it’s just about collecting a check.
I absolutely believe in the multiplier effect but if you start the multipication with a negative number (huge deficits), you end up with a negative number in the end.
President Doug Ross would do the following:
1) Abolish the tax code and replace it with a 5% flat tax and 5% national sales tax. Way too much of our nation’s brainpower is expended on useless tax-related analysis and processing.
2) Allow any American to opt out of Social Security and Medicare (but require 2-3% of pay to go into a fund for widows, orphans, disabled). That alone would pump
hundreds of billions of dollars into the economy. I will give up every dollar I have paid in for the past 30 years if I can have my money I earn for the next 20.
3) Implement a constitutional amendment that requires a balance budget.
4) Eliminate capital gains taxes on any securities held more than a year. Triple the capital gains taxes for securities held less than one week. We need to stop the churning that Wall Street does which drives bad policy by businesses.
5) Cut defense spending by half. Pull troops home from foreign bases unless the other countries are willing to pay for our servicemen.
6) Cut foreign aid by half. If the U.S. fails, we won’t have any money to give anyway. Obama never should have committed 100 million dollars to Haiti unless he cut spending by an equal amount. It’s very easy to look compassionate when you’re spending money you don’t have.
7) Give American technology businesses six months to reduce the number of H1B visa workers to 5% of what it is now. Importing workers to do jobs that Americans can do is bad policy.
8) Enforce all the immigration laws to their fullest by punishing companies that employ cheap labor at below market wages. How many legal South Carolinians would take those same jobs if they paid a true market wage?
9) Implement a law that any meeting between an elected official and a person representing any lobbying firm must be recorded on video tape and made available the same day.
10) Allocate $10 million to start sculpting my face onto Mt. Rushmore
Never said “All you have to do…” Said it beat the alternative, which is Hoovervilles.
How does the Ross agenda create or maintain jobs TODAY when people really need them?
If it happened before, it is far more likely to work now than some ideological mashup of pet projects that might save revenue initially.
People who work pay taxes. Taxes repay a deficit. People who don’t work and exhaust their resources either get services that run up the deficit, or take matters into their own hands. Lock and load, people….
Obama never should have committed 100 million dollars to Haiti unless he cut spending by an equal amount. It’s very easy to look compassionate when you’re spending money you don’t have.
How often does Congress cut spending? Our democracy moves slow. The people of Haiti are suffering now. Swift action is needed. There is not time for worrying about how the aid is going to be paid for.
The only point of Doug’s plan with which I agree is point 10).
Doug, we do have some common ground here. I agree with points 4, 5, 6 and 9. I’ll have to defer on number 10. As for the others:
1. A progressive tax is much more conducive to economic growth. I say tax the rich more, not less. Rich folks tend to save and not spend. What we need now is spending.
2. SS and medicare are spectacularly effective programs. Many folks have benefited greatly from each. In fact medicare should be expanded to cover everyone and all the other healthcare stuff, medicade, S-Chip, VA, should be abolished.
3. We had a balanced budget law that was never followed. And that’s a good thing. How can we ever respond to an emergency with such a restraint. Just look at the mess state government is in having to live within a balanced budget.
7 and 8. I don’t care about where a person is born. We’re all people with similar needs and skills. If a Mexican worker is willing to pound nails into shingles on a hot summer day I say more power to him.
Doug,
You had me up to No. 10. I don’t think $10 million will be enough.
Don’t miss Jon Stewart’s take on the Andre Mess:
http://www.thedailyshow.com/watch/mon-january-25-2010/thank-you–south-carolina—andre-bauer
One of the suggestions offered by a group of Obama’s economists is to suspend Social Security and Medicare deductions for the rest of the year. Now that would be an instant jolt to the economy with no government middleman involved. Cash money in consumers pockets is what we need.
Please don’t use the phrase “President Doug Ross” EVER AGAIN! Now I can’t sleep…
Doug, the Big W tax rebate in 2008 didn’t do the trick because middle income Americans will pay debts or save it – analysis from economists. The most stimulating approach is food stamps. Put money in the hands of those who will spend it all.
(Brad, you censored my quip about being scared of a country run by a President Doug Ross?!?!)
Randy,
If people pay off debt, the money doesn’t disappear, does it? It allows them to spend money they would have spent on interest on other things.
If people save money, the money doesn’t disappear, does it? It provides funds for banks to lend to others.
It’s silly to think that if every American worker had the cash currently deducted from their checks for Social Security and Medicare, that there would be no increase in consumer spending. That’s $700 a month for me. I promise my wife will spend it if I get it… 🙂
No, I didn’t censor anything. What did you say, Randy, that didn’t show up?
If people save money, the money doesn’t disappear, does it? It provides funds for banks to lend to others.
-Doug
Actually, under the circumstances we face today it really does. Banks aren’t lending much these days and they certainly aren’t paying interest on savings accounts. People aren’t spending because they’re either (1) currently unemployed or (2) worried about becoming unemployed. Businesses aren’t investing in plant and equipment because they’re worried that people won’t spend because of 1 and 2. Local and state governments are cutting back which leads to more 1 and 2. That leaves the federal government. They need to spend money like crazy and quit worrying about phantom problems like the risk of inflation. I keep hearing about this but with interest rates at zero there is no chance of that becoming a problem. The money markets take that into account otherwise interest rates would be rising right now.
So I say to Obama and congress spend like a drunken sailor. It’s the right medicine for our time. And quit worrying about the libertarian naysayers. They had their chance in 1930 and they failed the country miserably.
Also, it appears, banks spend the money on bonuses for their high-level management–the rich folk who actually spend—but on European luxury goods and hotel rooms in Gstaad.
Or, like the jackasses running Hallibuton, they moved to Dubai and bought in, and now the massive real estate crash there has them scuttling back to America before the Dubai government has them jailed.
Wonder what a Dubai jail is like…