Earlier today, President Obama said-
"It is absolutely true that we can't depend on government alone to create jobs or economic growth," he said. "But at this particular moment, with the private sector so weakened by this recession, the federal government is the only entity left with the resources to jolt our economy back into life. It is only government that can break the vicious cycle where lost jobs lead to people spending less money which leads to even more layoffs."
I view this statement very troubling on many levels. What do you think?
I'm a simple guy, I admit it. The reason our economy is faltering has to do with America consuming (spending) too much and producing (selling) too little.
People are freaking out and holding on to what money they have and not buying more stuff. The house of cards is starting to come down. A government spending frenzy will only dig a deeper hole for us. Any "jolt" this "spendulus" package gives will be extremely short lived and will carry a huge credit card bill very soon.
The answer- let things fall from where they are. Yes, it will be terribly painful effecting everyone negatively at first, no doubt. The market will have to correct. We (the U.S.) will have to start producing things the rest of the world needs and wants and we'll have to exercise some restraint in what we buy.
Again, I am a simple guy, I admit it. The government can't solve this with the current approach.