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Allow me to demonstrate...
We are presently in a zero job creation period. Employers are laying off workers and no jobs are being created to replace them. If the auto industry fails, as it very well could (and perhaps rightfully should if only the CEOs would be affected) that would dump another 3.5 million or more unemployed people into the system on top of the 6.5+ million now collecting unemployment and countless million others who have now run out of it. This massive number of unemployed (likely over 15 million) equates to 5% of the ENTIRE population of the US, INCLUDING CHILDREN, INCLUDING those collecting Social Security. With approx. 151.4 million working Americans that equates to 1 in 10. Decreased buying power results of this, first from those who can't afford to spend for more than necessity anymore (the unemployed) and soon thereafter by those who still have jobs that, realizing the crisis at hand, stop spending as well. This has already begun to happen. Look at the auto industry. People have stopped buying cars. Look at the housing industry. People have all but stopped buying houses. Look at any major asset industry and you will see the same. People are waiting to buy or cannot afford to buy luxury items. When 10% of the population is out of work, something else begins to happen. The affect of penny pinching on the economy ripples again and more businesses have to close thus increasing the number of unemployed, thus increasing the number of penny pinchers, thus increasing the number of unemployed... It is cyclical and terminal.
FDR's programs under the New Deal revitalized the economy as did WWII by getting people back to work so that they could consume again. The 1950's boom was the result. We NEED to do this now. Bailouts are temporary fixes. It is cash to keep companies on their feet. They are a stop gap alone. We must create jobs. We have a crumbling infrastructure. Bridges, electricity grid, roads, the spread of broadband internet, any number of things will do, just make the jobs. Likewise, those who claim that the bailout, no matter how big, is wrong, are WRONG. It is a temporary measure that must be taken UNTIL people have money again and begin to spend again. I have no love of big business, but they do employ millions. For the economy to rebound, these people need to remain in jobs. Otherwise, the gov't will have to subsidize that much more industry to make that many more jobs to kick start the economy again. The infrastructure already exists in big business, maintaining that on life support is the best alternative now while creating new jobs. The true economic kick start is one that spurs spending by the general population. Jobs are needed. Bail outs are only a lifeline.
That's my two cents, flames discouraged,
Peace,
NTF
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