This article was last updated on August 1
In a recent town hall, following the approval of yet another home buyer credit extension, President Barack Obama said his economic stimulus programs did their job by staving off another Great Depression. The administration often touts that the stimulus package helped create hundreds of thousands of jobs and propped up social programs such as unemployment benefits. But with much of that money spent and lawmakers reluctant to approve another big round of spending, concerns are rising about what will replace it in the short term to keep the economy moving. The President did acknowledge public skepticism about the effectiveness of last year’s $787 billion stimulus bill, but joked he could have sent people a check with his picture on it. Instead, the stimulus bill gave most workers a tax cut in their paycheck. A check in the mail might have been better politics, Obama said, but the tax cut in the weekly paycheck worked better economically.
With US unemployment hovering around 10%, weak stock markets and home sales plunging, the Obama administration is still hoping to use stimulus programs to accelerate the US economic recovery. However, this tactic remains in stark contrast to European countries’ recent austerity measures , and there is concern that further stimulus may adversely affect the US recovery. Economists are getting increasingly concerned over President Obama’s desire to spend more to encourage growth and lower unemployment. U.S. debt has hit about $13 trillion and 2011’s budget deficit is heading toward $1.56 trillion. Despite the uncertainty surrounding President Obama’s stimulus tactics, the U.S. government has shown little sign of slowing down spending.
What do you think? With the nation facing the very real prospect of a double-dip recession as growth and optimism wanes, should more federal home, car and work stimulus programs be put in place for 2010-2011 to keep the economy afloat? Or is it time to end the government lifelines and let free market capitalism take over where only the strongest and most careful survive? Have your say on poll below (email readers see poll here) and leave a comment if you’ve got more to say (keep it civil please!)
Good reads I came across this week were:
- The Rewards of Frugality and Thrift (or, Why We Scrimp and Save @ Get Rich Slowly. Work hard, but reward your self. His new tenant sums it up, “you can have anything you want, but you can’t have everything you want.”
- Are Political Donations Tax Deductable? @ The Dough Roller. This article provides the ins and outs of donations and learned a few things like not all contributions to political organizations are tax deductible. It really depends on their tax status.
- Oldest US Postal Worker Retires In Calif. At 95 @ NPR. This guy has been a U.S. Postal Service mail handler and forklift operator since he was hired in 1973, making $4 an hour. He hit the $25-an-hour ceiling about 10 years ago. The amazing thing was his attitude and longevity secrets. His modesty was also nicely summed up by this line, “Put your hand in a bucket of water, put it in all the way to your wrist. Take it out and the hole that you leave will be how much you’ll be missed.”
- Learning to Say “No” to Your Kids @ Moneyning. Teach them to value things now, or face big problems in the future.
- A Big Money/Life Lesson from Wal-Mart’s Sam Walton @ ChristianPF. Despite enormous financial and business success, Sam Walton failed his family. Poignant words we should heed in today’s 24×7 go-go world. Balance is key.
- 8 Critical Steps Every Family Should Be Taking to Prepare for the Next Financial Crisis @ Frugal Dad. The title says is all as we approach a critical inflection point in our economy. To me, building a second or alternative income stream is key in case your day job disappears like millions of others.
- How Much Do You Spend on Utilities Each Month? @ Genx Finance. Very interesting poll and unfortunately I was right in the 75% percentile. Need to get more green and energy efficient!
- 5 Investing Lessons from World Cup @ Financial Highway. Sports and making money, two of my favorite things.