Some of you may not have seen my previous post discussing my FOX Business Newsâ€™ TV interview, but this was the topic we were supposed to discuss. You check out what happened during the interview here if you want.
Yesterday, the Wall Street Journal published an article titled â€œ$35 Billion Slated for Local Housingâ€ which talked the Obama Administrations nearing completion on their commitment to bail out state and local housing agencies, known as Housing Finance Agencies, or HFAs. In essence, the Federal government is bailing out the State and local governments to ensure funding for low-income housing.
My first thoughts are why is this the first we are hearing about this bailout when the Obama Administration stated they would be transparent and they are ready to commit the funds, our money as taxpayers? I for one and sick and tired of the government wasting my hard earned money on programs that have little or no effect on the overall economy and act more as Obamaâ€™s re-distribution of wealth program. Even the $8,000 tax credit is a from of re-distribution of wealth in essence since it is ALL taxpayerâ€™s money funding only some homebuyerâ€™s and it isnâ€™t really doing a while lot in jump-starting the housing market.
If the government wants to bailout someone who will likely get the economy going, granted it will take a little longer, why not bail out the small business owners? Since small business makes up the largest portion of our economy, wouldnâ€™t it make sense that any sustainable economic recovery would come from their side of the equation? Instead, the government chose to bail out large companies who supposedly were too big to fail, even though those same companies may have deserved to fail and their failures would have allowed other businesses to grow and create more jobs in the long run.
It also makes me wonder what the government is thinking when they talk about extending the $8,000 tax credit for first-time homebuyers (FTHB) , then turn around and discuss the demise of the mortgage interest tax deduction as a possible solution to cover the increased costs to the government. Which is the larger incentive here to own a home in reality? A one-time tax credit for a relative few or ongoing tax savings from the mortgage interest rate deduction that most homeowners can take advantage of?
And what has all of this excessive government spending done to our illustrious dollar and inflation? Well, most of you may not have a full picture. Inflation is here, but the data just does not show it yet, and least not its fullest potential. But let me give you an idea of how hard you will get hit, especially if you leave the country as I do.
You see, I travel to Brazil a lot for my flying career and they have inflation as well. My favorite meal in Rio de Janeiro used to cost R$60 (Reais is their local currency), but it has gone up during the last six months to R$65, a modest jump and no big deal from the looks of it. But with the government doing everything they can to devalue the dollar so they can pay back their debts for pennies on the dollar, the exchange rate has dropped from around $2.45 to $1.79 in the same time frame, a significant decline (over 25%) to say the least. That means my meal that cost me $24.49 six months ago now costs me $36.31, an increase of over 48%!!!
OK, again, not a big deal as long as you stay within our borders. But if you plan any type of vacation abroad, know that you government is doing the best they can to devalue the dollar and make your vacations abroad more expensive and likely unaffordable.
The bottom line is that the government, through this $35 billion dollar program and the countless others, are spending way too much money on programs that have little to no effect on sustaining an economic recovery. Instead, they are focused on spending even more of taxpayers dollars on healthcare reform and other programs that will likely do more harm than good and will ultimately result in higher taxes for the majority of the population (donâ€™t believe for a second that it will just be the â€œupper classâ€), making matters worse.