Much like John McCain — and most Americans, I would guess — “the issue of economics is not something I’ve understood as well as I should.” But we’re all getting a speed-reading course in it now, aren’t we? The only trouble is, of course, that this is not Econ 101 (which I did take, by the way), but this is PhD. level economics. Nothing like jumping right into the deep end.
I understand that this country has basically been operating on credit for the past few years. (Personally feel like I constantly have Suze Orman on my shoulder lecturing me on all my past poor purchasing decisions. I know, Suze! I’m trying to pay off my credit card debt and save for retirement. I really am! Yes I know we probably shouldn’t have taken that trip to Cape Cod this year, but …)
But I digress. Last night the Senate passed a bank bailout rescue bill. And I have no idea whether it’s the “right” thing or not. At this point, it’s probably as good as we’re going to get. Anything with real teeth in it — anything that requires true courage and character from our politicians in Washington — is not going to happen as we get closer and closer to the elections. Remember, the entire House of Representatives — all 435 of ’em — are up for re-election this year. They like their jobs. They want to keep them.
From what I’ve read, the Senate bill is better than the one the House defeated. It’s not perfect; it’s better. From Bloomberg:
The U.S. Senate approved tax cuts valued at more than $100 billion, including a host of alternative energy credits and dozens of breaks for businesses and individuals, as part of its $700 billion bank rescue bill.
The legislation, which the House likely will act on tomorrow, passed the Senate on a 74-25 vote. It would give the Treasury Department authority to buy troubled assets, chiefly mortgage- backed securities that are burdening financial institutions.
The Senate added the tax provisions to woo Republican votes in the House, where an earlier version of the bailout plan failed by 12 votes on Monday. The tax package would spare 24 million American households from a scheduled alternative minimum tax increase this year, renew credits for business research, and extend $17 billion in energy incentives….
It would be “virtually impossible” to expand solar energy without the credit, Madison Grose, a managing director at Starwood Capital Group LLC, said yesterday in an interview before the vote. “The cost to the rate base for these types of projects is substantially higher without the investment tax credit being part of the capitalization of the projects.”
Solar energy is something that has always fascinated me. I don’t pretend to really understand the technology behind it, but consider this: Think about the advances in cell phone technology in the past 10 years. Phenomenal, isn’t it? And although Suze Orman would certainly advise against using your credit card for it, an iPhone is available for the average person.
Now think about solar panels. When was the first time you heard of them? About 40 years ago? President Jimmy Carter had them installed at the White House. Then President Ronald Reagan moved in and had them removed. Unlike cell phones, solar panels are still way out of reach for the average American. The amount of research and technology that has gone into making cell phones an everyday tool have not been invested in solar panels. Why? I can only assume that there’s not the profit to be made in solar energy that there is with cell phones. And if that is the case, then the Government must step in as they are doing in the Senate bill passed last night.
What do you think?