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Friday, January 11, 2008

Deciphering and Decoding Hillary's Stimulus Plan

I believe that Hillary is looking to awaken the ghosts of FDR with her sweeping economic stimulus package. The plan is heavy on bailouts, rule changes, and expansion of several already bloated government programs. Clinton gives tax cuts a token look promising to look at a 40 billion dollar direct tax cut only if the recession continues to worse.

Clinton plans on not only giving a 30 billion dollar bailout to struggling mortgage holders but also ten billion dollars to expand unemployment insurance, and $25 billion for heating assistance.

She wants to put a moratorium on foreclosures. If all of that still fails she wants to give a tax cut.

This is a poor man's version of FDR's first 100 days. There are layers and layers of things going on here. First, it is pretty obvious that something about her message on mortgages is polling well because it is becoming a bigger and bigger portion of her domestic policy. If that is so, I would love to see the polling her plan receives among general election voters. I just cannot believe that the majority of the country would buy the garbage she is spewing.

Her purported mortgage bailout is nothing more than a plan to delay the inevitable. The idea that holding off the banks for ninety days will do anything is the sort of thing someone naive and with no understanding of the dynamics of the crisis would suggest. If someone is about to be foreclosed they have missed payments for six months and more. Moratorium or not, their situation is dire. She can hold off the bank for ninety days but that won't change the dynamic that got them there. ( Here is my previous review of her mortgage bailout.)

The stimulus through government spending not only takes Clinton to her socialist roots but I believe it is also some sort of homage to FDR. In any case, I think it should be clear to the voters how each party party would approach the economic crisis.

This sort of big government populism should be a staple in every democrat's economic stimulus package. The Republicans will respond with tax cuts like what Rudy proposed. McCain has tied all of this to spending cuts while Thompson and Huckabee have used the debate to highlight their respective flat and fair tax proposals. We will see what the public likes...


MIke W said...

Seems to me that anyone who has a mortgage payment should hold off payment and join the masses of whiners and criers. Its only time before the Liberals will be paying the mortgages off of the poor(?)and handing them the deeds to houses they could have never afforded.

mike volpe said...

Not necessarily... the Bush rate freeze plan is only for those currently on time with their mortgages. Now, the plan is convoluted and full of problems however one thing that was stated is that it would only apply to those currently on time with their mortgages. Here is how I wrote about the rate freeze...

Matt said...

Hey mike, first time reading your blog. i'm with ya on the housing freeze... Bush gets dumber and dumber as time wears one.

Anyways, on topic... from:

The plan won't be offset by spending cuts elsewhere because the idea is to inject new money into the economy, Sperling said. ``This is the exception to her hard-and-fast rule that new initiatives should be paid for.''

i think Hillary is more a throwback to Jimmy Carter. "Some folks got problems? Just print 'em some money!"

This is insanity. The only reason the democrats have a shot is because fiscal conservativism is not sexy... and i'm not a republican, either.