Where Has All The Money Gone?

Where Has All The Money Gone? Image

Since the start of the current recession (Dec 2007) through August 2010 the Federal Government has spent nearly 4 trillion dollars more than it has received in revenue.  In other words the national debt has increased by that same amount.  Official unemployment stands at 14.8 million people.  But the average unemployment over the same period (using the Federal Governments’ Bureau of Labor statistics) is 12.95 million people.  What if all this money went to reducing unemployment?  Performing simple division, this means that over 300,000 dollars (308,880 to be exact) could have been spent on each of these 12.95 million people to employ them for one year.  Alternatively, assuming that all of these people could be employed with jobs paying 50,000 dollars per and the average unemployment is 12.95 million people, this would compute to 6.18 years of wages.  If the 4 trillion was applied to the current 14.8 million unemployed people, earning 50,000 dollars per year, then this would translate into 5.4 years of wages.  Thus, unemployment would be non existent for over five to six years.  But curiously, today the USA still has both 14.8 million people unemployed and $4 trillion in additional debt during the current recession.

Where has all the money gone?

The stimulus III package has just been passed.  Congress and the President have approved the Small Business Jobs Bill ( H.R. 5297) to cut taxes, provide more SBA funding and ease credit for small businesses.  This is targeted to increase jobs.   Stimulus I was $168 billion under George Bush.  Stimulus II was nearly $800 billion bill named “American Recovery and Reinvestment Act of 2009”.   The goal of that stimulus package was: “… to stimulate the economy by preserving and creating jobs, assisting the unemployed and uninsured, and providing state budget relief while making investments in infrastructure, education, science, health, and energy efficiency.”  The two Obama stimulus programs are targeted to create jobs.  But, today the USA still has 14.8 million people unemployed and $4 trillion in additional debt during the current recession.

Where has all the money gone?

From the above, it is abundantly clear how inefficient job creation is when Washington tries to accomplish this task.  Here is a typical example:   The Los Angeles county public works controller Wendy Greuel, says:  “I’m disappointed that we’ve only created or retained 55 jobs after receiving $111 million,” from the American Recovery and Reinvestment Act.  This is over 2 million dollars for each job!  The audit says the numbers were disappointing due to bureaucratic red tape, absence of competitive bidding for projects in private sectors, inappropriate tracking of stimulus money and a laxity in bringing out timely job reports.  This is par for the course for just about everything that Washington attempts.   Limited government, per the founding fathers prophetic vision, is the perfect answer.

Where has all the money gone?

Henry Morgenthau summed up the similar policy failure of the Roosevelt Administration in April 1939:  “Now gentlemen, we have tried spending more money.  We are spending more than we have ever spent before and it does not work…I say after eight years of this administration we have just as much unemployment as we started…and an enormous debt to boot.”   The lesson is that those who do not know history are bound to repeat it!!

When we go to the polls in November, there are two questions to ask: Where has all the money gone?   And will we repeat all the disastrous history of the 1930’s?

Let’s hold our Representatives and Senators in Congress who voted for this added $4 trillion in deficit spending accountable for the answers by voting them out of office.  The US Constitution gives them the responsibility for and accountability over the budget.  It is obvious that they have utterly failed!

Should a new congress be elected in November 2010, they must also be held accountable from day 1 to the same two questions:  “Where has all the money gone?” and “Are we repeating the mistakes of the past?”  Our government is of the people, by the people and for the people.  It is about time that We The People assert our power over Washington and not the other way around!

About the Author: William J. Michie, Jr. has a BS and MS degree in Chemical Engineering from Drexel University and an MBA degree from Rutgers University.  He has had a 32.5 year career in Polyethylene Product Development with Union Carbide and Dow Chemical Corp. and is the holder of a number of patents. H. Marsman and D. Madio also contributed to this article.

About The Author: William has a BS and MS degree in Chemical Engineering from Drexel University and an MBA degree from Rutgers University. He has had a 32.5 year career in Polyethylene Product Development with Union Carbide and Dow Chemical Corp. and is the holder of a number of patents.