I’m not an economist. In college, classes in statistics and economic models were as uninteresting as watching pro bowling on television, and coeds paid more attention to men who quoted Dylan Thomas than Adam Smith.
Yet today the economy is foremost in the minds of most Utahns. Congress is mulling over a bailout to the auto industry, President-elect Obama is proposing a massive infrastructure works program, and Gov. Huntsman has requested new budget cuts and increased bonding for roads and highways.
A reader asked if I could make sense of the different proposals. As a non-economist, I answered that I could only apply my common sense test.
For the auto industry, for instance, I oppose a direct bailout. We shouldn’t reward Detroit auto executives who, from past performance, could take a pricey cocktail dress and turn it into a hair braid. On the other hand, we cannot allow an entire region of the U.S. to have the same Gross Revenue as Somalia. The auto industry doesn’t need welfare from Washington; it needs to sell cars and trucks.
Government can help. Give taxpayers a $5,000 tax credit for purchasing a new American-built car and you’ll see thousands of Utahns elbowing into showrooms to see a new Dodge or Ford.
Contrary to some Republican proposals, this is no time to declare a tax holiday for all Americans. Bill Gates doesn’t need a tax cut. If Congress wants to offer tax cuts, give it to companies who open up new facilities and hire new workers and place tax penalties on firms moving their jobs off-shore.
The U.S. unemployment rate soared by 33 percent since the first of the year, and the fear of new lay-offs is a vicious circle, convincing people to put off purchases which in turn leads to more lay-offs. Obama and Huntsman are right in focusing on job creation through needed infrastructure.
The WPA worked for FDR, and our state and nation could certainly use some fix-ups on bridges and expansion of transportation systems. If a few “constitutional Republicans” or environmentalists get in the way, give them a muzzle and lock them in a closet. We need jobs, not whining.
Americans wealthy and top-tier managers need to sacrifice too. There’s no need to lay-off workers when executives are pulling down multi-million dollar salaries. Recent data shows that the wealthiest 1 percent of American households controlled almost 35 percent of the nation’s net worth, while the bottom 40 had only two-tenths of 1 percent.
The wealthy can go without a paycheck for the good of the country.
I can’t argue with plans to save the banks. A banking crash would end up crushing all of us. Neither am I against reworking existing mortgage loans, but only for primary residences, not second rental home properties. Government won’t bail out losing casino owners in Las Vegas, so why bail out those who speculated on risky rental properties?
Again, I’m not an economist, but certain steps make sense. We need action – sensible action – now without the chill of partisan politics.