What is the difference between last year’s Bailout thing and the recent “Economic Stimulus Package?
Written By: admin on May 31, 2009
One Comment
I havent kept up with current events, and I'd like to know if theres a difference between the Bailout and Stimulus Package… Are they the same thing? Or are they different? Also, did either one get passed yet? Furthermore, which one was associated with McCain? Obama?
Thanks for edu-ma-cating 
!!
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Tags: bailout, cating, current events, Financial News, mccain obama, stimulus packageTags: bailout, cating, current events, mccain obama, stimulus package
The economic bailout of last year was focused mainly on the financial sector (mostly banks) and was designed to unfreeze the credit market. In other words, it was designed to convince people and businesses to borrow again, and convince banks to lend again.
It was to do this by giving money to the banks, so they really had money to lend again. We don't know if it has worked yet or not, but more and more signs are pointing to no.
The stimulus package is an attempt to jumpstart the whole economy again. Basically to get customers buying again, investors investing again, and businesses hiring again. The basic thought is to invest in infrastructure.
That basically means building new roads and repairing ancient roads, which could and should lead to lower operating costs for businesses when they can find more efficient routes to destinations (saves much in gas) and not have to pay for repairs to truck and shipping fleets for hurt done by potholes.
More money going to adding Internet Access towers and so forth. This should provide bettere worker-to-worker, worker-to-business, business-to-worker, and business-to-business communication. That should greatly increase productivity and efficiency, and also opens up a new avenue of sales for businesses through online marketing to people they couldn't get to previously because they could not connect to the Internet.
More money going to education, to better train the upcoming workforce (current students) to handle the more technological jobs of the future.
More money going to various health issues and prevention, to save far more money on healthcare; which can then be better spent growing the economy.
Things like that. Current complaints are that it spends too much in pork spending, which basically means a bunch of pointless spending that is just designed to get votes in their respective districts and what have you. Things like a corn museum in Nevada, which doesn't really contribute to jobs or economic growth around the country.
Similiarities?
Democrats are spending too much, and instead of doing something about it Republicans are trying to add more to the stimulus. They were successful in the last bailout, which started at $700 billion, but went up to $850 billion when the Republicans were done with it.