Tuesday, April 8, 2008



The Democrat controlled Senate is formulating a new stimulus bill that, according to its champions, goes directly to the housing problems that the pols and Wall Street poohbahs assume are at the foundation of our economic and financial problems. The bill contains $11 billion in tax relief for homeowners and “incentives for first time homebuyers.” What a great idea—encourage more people who can’t afford homes to buy homes!

So now we have a trifecta. Our government is proposing to solve problems wrought by excessive spending with more spending (See, inter alia, my 1/7/08 post “THEY’RE ALL KEYNESIANS NOW.”), to address the problem of excessive leverage with more leverage (See, inter alia, my 3/20/08 post “HAIR OF THE DOG.”), and, now to address the difficulties that result from people who have no business owning homes “owning” homes by encouraging more people who have no business owning homes to “purchase” homes. (See, inter alia, my 4/3/08 post “PARTY ON, SENATORS!”)

For his part, our “free market” President admirably urges caution in applying government salves to problems that defy government solutions. But then he returns to form by urging Congress to allow his “pro-growth (his words) package” (i.e., the tax rebate scheme) to work.

So an intrusive, overreaching Congress is urged by a rudderless, clueless, gormless President to follow a “pro-growth” plan that involves borrowing more money to give to people to spend in order to solve a problem caused by too much borrowing and too much spending.

Remember this when the “experts” tell you that we can never go into a Depression again because the government will do whatever is necessary to avoid a ‘30s redux.

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