The Economy: The economy would have fixed itself if the government had stayed out of the private sector.
Allowing the banks and auto makers to file bankruptcy would have saved this country billions of dollars. In addition the economy’s free fall would have stabilized more quickly and jobs would have been saved rather than lost. The bailouts prolonged the inevitable. A perfect example is Chrysler and General Motors.
The housing bubble burst because the banks allowed people to receive loans they could not afford. The negative assets on Banks balance sheets should have been renegotiated. This would have resulted in a slow down and would have stopped most of the foreclosures. In the long run, this would have made the banks more profitable.
Whatever the government does to businesses will directly affect the employees. Businesses are in business to make money. Raising the corporate tax rate the Federal Government imposes on businesses, forces businesses to their cut costs. When costs are cut, jobs are usually the first to go. Second, such taxation makes businesses look at relocating outside this country. Naturally this has a negative effect on the economy and a loss of tax revenue.
We have the second highest corporate tax rate in the world. To put this in perspective, would you work for a company that charged you 35% of your pay just for being an employee (i.e.an employee fee)? In essence the federal government is using these same principles. Lowering the corporate tax rate would spur business growth and attract foreign businesses to relocate in the United States which equates to the creation of jobs and tax revenue.
Out of control spending in the Federal Government will negatively affect the economy. Sustained growth cannot be maintained with an uncontrolled debt. Common sense dictates that the debt to income ratio must be maintained. Currently the federal government is on the brink of an unsustainable debt, therefore, they need to live within their means and cut waste and abuse of money. Pork, Social Security, and Medicare are all riddled with abuse.
Congressmen are elected to represent their constituents in what is best for the country. Abuse of the system has a negative impact on the economy and must be addressed.
