Best of the Week
Most Popular
1. Gold vs Cash in a Financial Crisis - Richard_Mills
2.Current Stock Market Rally Similarities To 1999 - Chris_Vermeulen
3.America See You On The Dark Side Of The Moon - Part2 - James_Quinn
4.Stock Market Trend Forecast Outlook for 2020 - Nadeem_Walayat
5.Who Said Stock Market Traders and Investor are Emotional Right Now? - Chris_Vermeulen
6.Gold Upswing and Lessons from Gold Tops - P_Radomski_CFA
7.Economic Tribulation is Coming, and Here is Why - Michael_Pento
8.What to Expect in Our Next Recession/Depression? - Raymond_Matison
9.The Fed Celebrates While Americans Drown in Financial Despair - John_Mauldin
10.Hi-yo Silver Away! - Richard_Mills
Last 7 days
Stock Market Critical Price Level Could Soon Prompt A Big Move - 25th May 20
Will Powell Decouple Gold from the Stock Market? - 25th May 20
How Muslims Celebrated EID in Lockdown Britain 2020 - UK - 25th May 20
Stock Market Topping Behavior - 24th May 20
Fed Action Accelerates Boom-Bust Cycle; Not A Virus Crisis - 23rd May 20
Gold Silver Miners and Stocks (after a quick drop) Ready to Explode - 23rd May 20
3 Ways to Prepare Financially for Retirement - 23rd May 20
4 Essential Car Trade-In Tips To Get The Best Value - 23rd May 20
Budgie Heaven at Bird Land - 23rd May 20
China’s ‘Two Sessions’ herald Rebound of Economy - 22nd May 20
Signs Of Long Term Devaluation US Real Estate - 22nd May 20
Reading the Tea Leaves of Gold’s Upcoming Move - 22nd May 20
Gold, Silver, Mining Stocks Teeter On The Brink Of A Breakout - 21st May 20
Another Bank Bailout Under Cover of a Virus - 21st May 20
Do No Credit Check Loans Online Instant Approval Options Actually Exist? - 21st May 20
An Eye-Opening Perspective: Emerging Markets and Epidemics - 21st May 20
US Housing Market Covid-19 Crisis - 21st May 20
The Coronavirus Just Hit the “Fast-Forward” Button on These Three Industries - 21st May 20
AMD Zen 3 Ryzen 9 4950x Intel Destroying 24 core 48 thread Processor? - 21st May 20
Dow Stock Market Trend Analysis and Forecast - 20th May 20
The Credit Markets Gave Their Nod to the S&P 500 Upswing - 20th May 20
Where to get proper HGH treatment in USA - 20th May 20
Silver Is Ensured A Prosperous 2020 Thanks To The Fed - 20th May 20
It’s Not Only Palladium That You Better Listen To - 20th May 20
DJIA Stock Market Technical Trend Analysis - 19th May 20
US Real Estate Showing Signs Of Covid19 Collateral Damage - 19th May 20
Gold Stocks Fundamental Indicators - 19th May 20
Why This Wave is Usually a Market Downturn's Most Wicked - 19th May 20
Gold Mining Stocks Flip from Losses to 5x Leveraged Gains! - 19th May 20
Silver Price Begins To Accelerate Higher Faster Than Gold - 19th May 20
Gold Will Soar Soon; World Now Faces 'Monetary Armageddon' - 19th May 20
Gold Mining Stocks Fundamentals - 18th May 20
Why the Largest Cyberattack in History Will Happen Within Six Months - 18th May 20
New AMD Ryzen 4900x and 4950x Zen3 4th Gen Processors Clock Speed and Cores Specs - 18th May 20
Learn How to Play the Violin, Kids Activities and Learning During Lockdown - 18th May 20
The Great Economy Reopening Gamble - 17th May 20
Powell Sends a Message With Love for Gold - 17th May 20
An Economic Renaissance Emerges – Stock Market Look Out Below - 17th May 20
Learn more about the UK Casino Self-exclusion - 17th May 20
Will Stocks Lead the Way Lower for Gold Miners? - 15th May 20
Are Small-Cap Stocks (Russell 2k) Headed For A Double Dip? - 15th May 20
Coronavirus Will Wipe Out These Three Industries for Good - 15th May 20
Gold and Silver: As We Go from Deflation to Hyperinflation - 15th May 20

Market Oracle FREE Newsletter

Coronavirus-stocks-bear-market-2020-analysis

Forget QE3, America Needs a Real Road and Job Stimulus

Economics / Economic Recovery Jun 28, 2012 - 03:29 AM GMT

By: EconMatters

Economics

Best Financial Markets Analysis ArticleHow is the condition of roads that you drive On? Well, the roads that I drive on are so bad that they require a large truck or SUV to navigate at anything close to normal speeds. The potholes are alignment killers, and the horrible patches were slapped on so poorly that they become uneven speed bumps. And I reside in one of the top 5 largest cities in the U.S. with a lot of petro money that has done much better than most of other cities (e.g., the newly bankrupt Stockton, CA) during the financial downturn in the economy. It gets better yet; I'm talking about the better part of town instead of the lower revenue districts. So the question is how did we get to this state? And what are the likely solutions?


I think a lot of City, County and State revenue which ought to be going towards upkeep and proper maintenance of the roads is being diverted to other areas of government, i.e., administrative and higher than market salaries of government employees (Include benefit calculations into this equation). In short, big government spending is out of control, and it is so bad, that revenue which is supposed to go towards basic services like quality roads to drive on is being circumvented by other factions of big government which should be further down the line on the need food chain.

This fact really points out what a disaster the first $900 Billion stimulus was, and how if we cannot get these roads fixed when that money was on the table, when will we ever be able to drive on quality roads again like in the 1950 and 1960`s? It literally has been that long since some of this infrastructure was originally built, and is long overdue for a full replacement cycle of CAP EX spend, and not more ad-hoc patch jobs.

One solution is to do another round of stimulus, this one dedicated strictly to mainstream road and infrastructure projects like bridges and basic utilities. This means 100% infrastructure spend, not 5% like the last stimulus with the majority of the rest going to either special interest or pork barrel projects. This will be expensive, in the Trillion dollar range, but yes the roads are that bad. However, with the economy lacking any true growth prospects, and the ad-on effects of true job creation, which a legitimate infrastructure package brings, this expense can in part be paid for with increased tax revenue reaped from a healthier economy.

But there is a caveat, and a large one, these jobs need to be for existing American citizens. These jobs cannot be offshored or outsourced. As the current projects are outsourced to private firms, who then maximize profits, and sacrifice quality of product by hiring illegal immigrants to do the bulk of the physical labor. The country doesn`t reap the entire benefits if the existing model of road construction outsourcing of these jobs ultimately just sends a substantial sum of this money out of the country via Western Union (the figures over the last decade have been staggering to say the least).

The other solution is for governments to slim down and cut the wasted bureaucracy, so that funds which should be going towards maintaining quality roads are actually used for this purpose. This probably would only occur if the voting public starts demanding better roads, to the point where it actually becomes a campaign issue that politicians have to make public stances on, and be voted out of office for not delivering upon said objective.

Unfortunately, I don`t think voters really care about this issue, and would rather have their local pork barrel spending projects, and just drive heavy duty SUV`s to traverse the roads. Compare our roads with German roads and you can visualize the quality of product produced, and commitment to infrastructural needs in this country.

By the look of our roads you would never guess we are a first rate Super-Power in terms of Capitalistic revenue generation. Again traversing roads that seem like roads in some third world countries, I have to ask where is all the money going? And whoever decided this wasn`t a high priority for the last stimulus package needs to be voted out of office for dereliction of duty.

Disclosure: No Positions

By EconMatters

http://www.econmatters.com/

The theory of quantum mechanics and Einstein’s theory of relativity (E=mc2) have taught us that matter (yin) and energy (yang) are inter-related and interdependent. This interconnectness of all things is the essense of the concept “yin-yang”, and Einstein’s fundamental equation: matter equals energy. The same theories may be applied to equities and commodity markets.

All things within the markets and macro-economy undergo constant change and transformation, and everything is interconnected. That’s why here at Economic Forecasts & Opinions, we focus on identifying the fundamental theories of cause and effect in the markets to help you achieve a great continuum of portfolio yin-yang equilibrium.

That's why, with a team of analysts, we at EconMatters focus on identifying the fundamental theories of cause and effect in the financial markets that matters to your portfolio.

© 2012 Copyright EconMatters - All Rights Reserved Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules