Sunday, February 15, 2009

What We've Learned About "Stimulus" So Far

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Congress and the Piece Of Stimulus

Congress has passed the most pork laden piece of legislation in the history of the Republic. (Perhaps one of the reasons they use the word "Congress". Like "sexual congress", the public is being screwed!)
Let's review a few of the principles involved in this top down Piece of Stimulus (POS):

Businesses should not reward their top performers by taking them on trips to expensive resorts.

This, of course, would only benefit the airlines, the hotels, the cabs and rental car companies, the hotel staff, restaurants, gift shops and whatever state, federal and local agencies tax the employees and profits of all of the above.
The one exception to this, would be if they took a heavily subsidized train to a resort in a state like Nevada, where a politician was in a highly placed position...say Senate majority leader. This would be a good thing for immediate "stimulus", even though the environmental impact reports for such a project would not be completed until well after the next presidential election!

Corporate jets are a sign of decadence and must be shunned as excessive wastes of money before companies can receive stimulus.

So, take a thriving industry that employs highly trained engineers and skilled workers, that produces a high end product that generates high paying jobs for both building and support, which creates high taxes for both the product and the salaries of all involved and let's see if we can choke this domestic industry to death?
Good plan!

Change the successful "Welfare to Work" provisions of the Clinton administration.

Yes. Nothing says inflation like requiring fewer people to produce anything in the economy while paying more to achieve it!

Put a salary cap on corporate executives and eliminate bonuses.

This is brilliant! A) Many companies will not have the government dictate what compensation they pay, for fear of losing their top performers to industries not taking the government money. It will cause many companies to turn down the POS, thus freeing up money for pork in other places!
B) Some companies will find ways to compensate their performers in ways not called "salary" or "bonuses". ("Stock options" comes to mind!) In this creative way, politicians can posture that they are for the "little guy" while only changing the nomenclature in their little hypocritical game.
Also, see: "whatever state, federal and local agencies tax the employees and profits of all of the above." This has already taken a toll on Wall Street where reduced bonuses have resulted in reduced tax revenues for NYC.
BTW, bonuses are an incentive to do above and beyond what your salary calls upon you to do. Take away incentive and productivity could fall. (See: "Inflation")

I'm sure there are myriad more lessons to be learned from this Piece of Stimulus, but I think I'll go do something to cleanse my mind from politics...maybe there's a sewer line somewhere that needs opening?

Cross posted at Say Anything

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