Saturday, February 9, 2008

Inaction Is Political Suicide

The stimulus package that was passed by Congress and awaiting the signature of the President has received support from both parties and is seen as a "jump start" to our economy. As an economics minor, this will work; but only in the short run. "Solutions" like this do not help the economy in the long run. The problem is that in times of economic downturn, Americans today have a feeling that the government must do something to fix it. The economy has ups and downs, and it will correct itself. Demand goes up, businesses make more, hire more, eventually make too much supply, demand goes down, economy recedes, products get cheaper, demand goes up's cyclical. This cycle will always be there, but the economy always recovers, and comes back better than ever. Government actions such as this stimulus package just make the ups and downs more sporadic and severe, more herky-jerky, if you will. The economy corrects itself, and intervention often messes things up and adds to the national debt, which also makes bigger long term complications.

Unfortunately, inaction in regards to the economy is nearly impossible in our political atmosphere. People expect the government to fix it, and both parties feel they have to do something, lest people get mad at your party for doing nothing...even though that, in reality, it is most likely the best solution.

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