With the dollar in free-fall and Congress providing bread and circuses rather than action (the “stimuli check”, the Waxman Steroid Witchunts) you have to wonder why we elect these people. The best thing Congress could do tomorrow to stop the bleeding would be to make the Bush tax cuts permanent.The pundits aren’t telling you this because they don’t think it possible.
Our dollar, and our economy are based on trust and confidence in the future. With the tax hike coming, the future has become uncertain, so the economy has slowed. Why did it happen now, why’s it seem so sudden?
Businesses and financial institutions plan quarter by quarter in two year cycles, and the bean counters at every Fortune five hundred company in America have looked two years ahead to tax hikes this quarter. They see less money in the economy as consumers feel the pinch, and they see marginal businesses failings downroad from the tax hike that will occur if congress doesn’t act. They see uncertainty, and they see less confidence.
If congress wants to stop the bleeding, they should make the cuts permanent and they should do it today, not tomorrow. One of the best things about life is security and hope for the future – if that future becomes uncertain then security and confidence both wilt, and we all know that bean counters are not the bravest souls to begin with.
The legislative loons in the Democrat party think they have time to wait until after the election, but confidence in the future and security must be granted now by congress because bean-counters plan ahead, and the accountants are taking that future accounting right now.
Demagogues like Pelosi and Obama can try to blame “big business” all they want, but big business has to deal in the real world of cause and effect, balance sheets and cash-flow, because they hold the trust of their investors and that’s a trust they must keep faith with.
If you are in a 401k or other retirement investment plan, that means they must do their best to keep your trust, regardless of the sound and fury of Congressional Theater. This didn’t happen suddenly, or out of the blue. It happened as we entered this quarter for a reason – the business planning cycle. It’s time for congress to restore the faith and confidence in the future, they need to make the tax cuts permanent.
UPDATE: Here’s a fine example of how Democrats crush security and confidence through taxation.