Wednesday, February 11, 2009

Funny Money, or the case of the appearing and disappearing mega-funds

Dear Dylan Thomas,

You may wonder why I write to you on this topic. You are no economic expert. But I come to you because I fear going gentle into that dark night. Is that a bit dramatic? Really I am trying to make sense of it all. But I admit I am confused and a bit afraid.

So what do I see as the "dark night"? Our economy has depended too much on credit...bad credit, and it is all falling apart. There is no money, spending is down, and the economy is in a tail spin. They say it could be a depression, utter disaster, maybe the beginnings of the end. But there is a chicken in my pot every night and I have not even had to cut cable yet, so I don't feel it coming. But foresight is golden, as they say, and not everyone has been as lucky as me. It's jobs that are being lost, and if mine were lost it would not take long before I too would begin to suffer. However, it is not suffering that I see as the dark night.

So, the government wants to help. And so it should. It is here to do what we cannot do for ourselves, and the economic stability of the nation is one of those things that we as individuals cannot control in the big sense. So lets talk about that a minute. And to do so I am going to use a metaphor and see if it fits. It may not. I am bringing it down to my level, just to make sense of it.

OK, we need jobs in this country. Jobs produce money for families who then spend it and, in so doing, employ more people. It is a cycle of positive growth. Right now we are in a negative cycle of job loss, less spending, and more job loss. Add in a "credit crunch" that means people have a harder time borrowing money, and the cycle speeds up.

Here is the metaphor that makes sense to me, poor though it may be. Let's say my car breaks down and I need a way to get to work. If I can't get to work I can't pay rent or food. If I can't pay rent, I lose my house and without food, I die (dire situation!). So it is worth an investment of cash in a new means of transport in order that I can keep my job. I would do this even if it means borrowing that money. I get this concept and this is obviously what Obama is trying to do right now. You gotta spend something to get something going.

But lets say I am broke with no car and I go to the Mercedes dealer and pick out a big ol' Mercedes SUV. And lets say my borrowing capacity is unlimited (as it apparently is for the government). The Mercedes will get me where I am going fast, reliably and in style and with as much junk as I want packed into it. Great, right? Or let's say I think it would be better if I borrowed a bunch of money to lay rail from my house to my job and started up a train service. I could not only get to work, but I could give others rides and charge them for it. An investment! Or I could buy a see where I am going? Just needing transportation does not make unfettered borrowing OK. What I need is a Ford Festiva that has four wheels and a decent engine that will get me back and forth. That is it. And you know, if it looks junky, more the better. It shows that I am putting money into the important house, food. I am not spending money to impress everyone. I am not trying to maintain a facade.

What I am saying is, we can fuss and cry about the countries "dire situation", but that does not make borrowing insane amounts of money OK. But how do we know, when it comes to the American economy, what the Ford Festiva-level stimulus plan would look like. Some say we are getting the Festiva plan, while others say we are getting the train rail with boxcars filled with pork. But either way, if the senators did not have time to read the bill, let alone truly vet it, then who really knows what we are getting?

I am just not comfortable with the fact that no matter the plan, (remember, Bush had 2 stimulus plans already in place and voted for by many of these same senators as well as the new President) it is based on the concept of printing up more "Funny Money". We are not pulling from reserves, we are just saying "Spending on this would be good and would create jobs? OK, lets do it!" Something about this just rubs me wrong. Plus, we are not even sure it is going to work. But I do like BRD's point that at least spending on projects gives us both jobs for people now and the fruits of their labor. That I can get behind.

I know I am rambling a bit here, but I am really trying to understand. I am trying to put responsibility where it belongs and look for a rational solution. I guess I feel like at a time like this, people without jobs SHOULD be doing things like canceling cable. But then that would put cable workers out of work, and then we have more unemployment. So what are we to do? Our current solution is to just use credit cards (more funny money) to buy the things we want without heed of paying things off. And this is just not working.

And here is where things get personal in the whole deal. I was raised to stand good for my debts, and to never borrow more than I can pay back. Hard work and good choice making were taught and reinforced. But to me, the more the government does for me. . . things that I could do for myself. . . the more they give me to boost my standard of living, the more I become their slave. How can I support a plan for our country that makes us more and more dependent on the government and puts us more and more in debt? I just feel like this plan goes against everything that I want to be and want for other people around me. The concepts, no, buzzwords, borrowing and bailout are our new economic salvation. I just don't like them.

And this is what makes me want to work take care of myself and those around me who are part of my community. I continue to hope, no doubt prolonging the agony, that these mechanisms will work without forfeiting the light of freedom that I cherish. But I fear as well. And so, Dylan, I continue to rage, rage against the dying of the light.

Thank God, most literally I mean God, that HE is my source of light, not the small actions of this government. That my true freedom can never be taken away since, to quote myself, true freedom* is "to have God in your heart and you love Him." :)

Yours sincerely,


In the Land of the Free

*Note from BRD: Upon investigation we found that this quote comes from an excellent piece on the meaning of freedom produced by the TV News team from Altoona, PA, circa (approximately) 1984. The occasion of this hard hitting report was the occurrence of July 4 and a much anticipated family celebration of same at the Highland Park.

1 comment:

cadh 8 said...

Thank you BRD for adding this referece information. There is some reporting that really sticks with you. Such was the case with this guy, who possibly had simply got stuck with holiday shift and was trying to find a way to enjoy a July 4th picnic AND work at the same time. But he got more than he bargained for with the Rupe clan!!