The stimulate debate

I cannot believe how much money our government is thinking about using in its stimulus package. Can you say $900 billion. A billion here and a billion there, and pretty soon you are talking about real money.

If you have been following the Economic Snapshots in The Daily Record, almost to the man (and woman), business owners and leaders want the government to keep its hands off the free market system. But, our politicians are not content to listen to the people. Instead, they feel an urge to do something regardless of whether or not it will work or stimulate the economy.

I believe part of the problem is people, and I include myself in this category, have been spending more than we can afford. Access to credit was oh so easy. In fact, many of the lending institutions that are in trouble and have been looking for money from the government got involved in loans where borrowers could not demonstrate an ability to repay (can you say no-doc and subprime loans?).

Because everyone was willing to loan money, approve credit cards, accept 90 days same as cash and other borrowing programs, people were spending money when they did not have it to spend. Consequently, we fueled the economy as we dug deeper and deeper into debt.

Well, at some point, something had to give. It did, and boy did it. Our economy has been hit and hit hard.

I am not an accountant, a business analyst or a financial adviser, and I will not even attempt to play one on this blog. However, in my simplified view of the world, this is what I see: people bought houses they could not afford or repay. This created a demand for homes, lumber, windows, furniture, furnishings, electrical equipment, shingles, concrete and everything else associated with building a new home and furnishing it.

This cooked up demand caused prices to climb higher than they would have naturally. Everybody was making money, and the economy was rolling along, however, did anyone stop to notice why this was so? We were trying to borrow our way into prosperity.

I'm sorry, but that just does not work. The Bible says the borrower becomes a slave to the lender (check out Proverbs 22:7). The only way to become prosperous is to save your hard-earned money and invest it (which includes starting your own business).

I have a feeling the economy will at some point level off, consumer confidence will rise and jobs will return. But this next time, let's not build our economy on the sand.

For another look at the stimulus plan and President Barack Obama's first two weeks in office, check out SWNID.