Cash for Refridgerators is as bad an idea as Obama Stimulus version 2
Ok, so President Obama won’t call it Obama Stimulus 2. I won’t even bother with stating again that this is exactly what I expected. The question I will delve into is if this latest stimulus package will be any more effective than the last?
Well lets start with the big idea. President Obama wants to give homeowners like me help in making our homes “green”. The plan is that in doing this I will save money, potentially 20%, on energy bills like heating or air conditioning. There is word that the proposal will be to give homeowner $12,000 in some form towards making a more “green” home.
The plan willlikely be that a homeowner will get either a tax credit, voucher or something that will rebate or kick back up to 50% of any money spent on new insulation, painting the roof white, installing a wind turbine or adding solar panels. This will, as the theory goes, stimulate the economy by creating new jobs and help people save money.
Now here are the major problems with this cockeyed idea. First is the fact that you need to have the money to do any of this. It’s great that up to $24,000 could be spent and it will only cost $12,000. But considering how many homeowners are currently out of work, or fearful of becoming out of work, and the record high levels of homes in default or trouble with mortgages does anyone really think that people are going to spend $12,000 en masse?
In fact the only people that might drop that kind of cash are the upper incomes of the nation. The “rich” that President Obama and democrats hate. The very same people that President Obama and Congress plan to soak with higher income taxes, capital gains taxes, and as owners saddle with higher health care costs and business taxes. Somehow I don’t think they are looking forward to spending money they will need very shortly for all the new taxes from President Obama and crew.
And it gets worse. Let’s say that somehow you have an extra $12,000 buring a hole in your pocket. Lets say you decide to improve the home. In fact you do such a great job you increase the efficiency of the home by 50%. Such a number is ridiculous but lets say you did it. Here comes the part that wasn’t mentioned.
President Obama, Speaker Nancy Pelosi, Majority Leader Harry Reid are all moving forward with Cap & Trade. You know the Bill that will “necessarily skyrocket” energy prices so America is forced to use less energy. The Bill that proposes to increase the cost of electricity and gasoline by 150% to 200% by some estimates. The Bill that lives up to the goal of President Obama to bankrupt the coal power plants (which make 50% of all the electrticity used in the nation).
So even if you had the money for this idea, which almost no one does, and you got exhorbidant success in making your home “green”, you would still be losing money – some 100% more in energy costs. Which leads me to wonder why anyone that has the money, and is aware of the plans President Obama and Democrats have, would take advantage of this goofy idea.
But don’t worry. The plan as it stand right now will only cost the nation another $10 billion dollars. And that’s only if it does not con people into buying new refrigerators and air conditioners. If it does work then you should expect that it might cost 2 – 3x as much, just like Cash for Clunkers did. And the net effect of that was a decrease in car and car related sales. [Recall that mechanics, used car sales, and other industries lost money during and since Cash 4 Clunkers. Thus it retarded job growth, not counting the reduced cars coming from factories.]
Wow, I’m sure the college professors at the Job Summit thought that this plan worked great on paper. But I’m kind of tired of acedemic experiments paid with my taxes that don’t do a damn bit of good for the nation. But how do you feel?
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December 9th, 2009 at 7:34 am
[...] thought I had about the new $150 billion proposal that President Obama has just announced (see Cash for Refridgerators is as bad an idea as Obama Stimulus version 2 for more) – which is an Obama Stimulus part 2 in all but a name. President Obama spent a [...]
December 9th, 2009 at 7:40 am
[...] thought I had about the new $150 billion proposal that President Obama has just announced (see Cash for Refridgerators is as bad an idea as Obama Stimulus version 2 for more) – which is an Obama Stimulus part 2 in all but a name. President Obama spent a great deal [...]