Economic Cause-and-Effect?

by Venomous Kate

I’m no economist. In fact, I can’t even claim to have taken an economics class. So if the following seems clueless and simplistic, please (nicely) help me see where my reasoning is wrong.

See, I’ve been thinking about how our childrens’ children will wind up footing the bill for this stimulus plan. And that got me to wondering… by the same logic, doesn’t that mean that WE have been paying for the FDR deals that helped our grandparents out of The Great Depression?

If that’s the case, perhaps there’s some kind of tie between being burdened with a previous generation’s debts and a tanking present economy.

In other words, did yesterday’s signing of the economic stimulus bill essentially seal the deal guaranteeing another, possibly greater, financial crisis for our grandchildren?

9 Comments to “Economic Cause-and-Effect?”

  1. Yes, well, you didn’t think the Obamessiah was going to be able to do His work without somebody paying the cost, did you?

    /sarcasm

  2. So what? We’re making it through, so will our kids.

  3. Surely you don’t include yourself in that “we” since you live in Quebec and aren’t affected by the economic stimulus plan, Terry.

  4. What I can’t figure out is why they just didn’t give every citizen a million bucks. That would have been cheaper and I would have certainly stimulated the economy with mine.

  5. Of course Canada’s included in the trickle-down effects!

    But really, I was thinking that we (here in Canada) go through the same cycle about paying for what our predecessors wrought and how our kids will pay for some of the things our governments are doing now. (The “we” was somewhat generic, in that sense.)

    Being one of those “kids” now, I’m in an age group wondering if there’ll still be old-age pensions here by the time we’re ready for them.

  6. Of course the pensions will be there — they’ll get the money from the younger generation’s taxes, and when that generation gets old enough for pensions they’ll take the money from the next younger generation, and so on and so forth shooby-dooby-do.

  7. Yes, but after the foolish went out and blew their million on big screen TVs, fancy cars and larger houses, they’d wake up one day and cry about not having any money leftover.

    And we’d be right back to where we are today: bailing out the short-sighted who spent more than they should have on stuff they didn’t need.

  8. I don’t understand why people keep thinking the taxpayers are on the hook for this money.

    Taxpayers are only on the hook for it if the government pays back the lenders, that is the foreign investors who float the t-bills that will pay for deficit spending.

    I think the current government is tipping its hand that it doesn’t intend to pay it back at all, which could mean that the foreign lenders don’t loan, which means….

    Well, I guess we’ll see, won’t we?

  9. Congrats on your matriculation from the School of Hard Knocks with a Degree in Economic Theory. Go forth and multiply.