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What Needs to Be Done to Get the U.S. Economy Moving Again?

Figures released last week showed the U.S. economy is slowing down again. What do you think needs to be done in order to avoid the country slipping back into recession?

Figures released Friday on the U.S. economy, and reported in the Wall Street Journal, didn’t bring any good news. The economy is reported to have slowed down in the second quarter of 2012, only growing at a sluggish 1.5 percent.

According to the WSJ, these results came as consumers cut back on spending and businesses grew even more cautious about hiring and investing. On top of that, the national unemployment rate remained unchanged at 8.2 percent and in Georgia the unemployment rate rose to 9 percent.

As people in the government on each side of the political aisle debate what to do to reverse this slow sink into another possible recession, what do you think is needed to get the economy back on the right track?

What needs to be done to reduce financial uncertainty in the U.S. and avoid the country slipping back into recession? Do you think that freezing government regulation on small business, as has been proposed in Congress, will help?

1stknightrealty.net July 30, 2012 at 04:20 PM
I truly believe that the housing industry holds the key to overcoming this drastic economic recession (or whatever it is). If we could get housing moving one more time, it would generate a lot of jobs that would help all retailers. The housing industry touches almost all areas of our economy. The credit criteria is simply too tight right now. What could be a better deal for the consumer and the housing industry than the opportunity to buy one of these homes while list prices and interest rates are both low. In 18+ years in real estate, I have not seen both of these items this low. WHAT THAT DOES IS TO GIVE YOU A HOUSE PAYMENT MUCH LESS THAN THE RENT YOU ARE PAYING TODAY. In Barrow County the USDA loan does not require a down payment. You do need about $ 1000 to $ 1500 in cash to pay for appraisal, home inspection, and a few other items. But this is the break that "the working class" has needed for a long time. You need a dependable job and decent credit to buy a home in 2012.
jerry moore July 30, 2012 at 04:31 PM
Oh dear where to start? First and foremost the government needs to get out of the way. By this I mean they don't need to be in the business of picking winners and losers. We've dumped a ton of money to save (big) banks and the automobile industry. We've poured another bundle of money into green energy which for the most part has failed. We've spent the better part of the last two years printing money to keep interest rates low, yet have devalued our dollar to the point that oil prices have risen to a point that has caused our economy to slow again. Many economist are now fearing that we are entering a "Lost Decade" of our economy. The Japanese experienced much the same of what we are now going through and their government spent years throwing money at the economy to no avail. Thus the Japanese economy has spent much of a decade trying to recover. So what would have happened if the government had stayed out of things. The big banks would have failed? Perhaps. The automobile industry would have seen a major brand disappear? Perhaps. While there would have been pain from all of this it would have been temporary pain. Out of pain comes opportunity. Big banks would have been split up into smaller banks who tend to know their customers better. A auto brand disappears, but another manufacturer picks up the slack from the demand created. Let the market choose the winners and losers and not the government.
Sharon Swanepoel July 30, 2012 at 04:33 PM
The only thing is that the recession took away a lot of that decent credit and banks got into trouble for sub prime lending before, they're too scared to do it again. The homes might be there, the interest rate at a great level, but credit just can't match up at the moment. The only thing that I can see helping that is time. People have got used to living with less, which is a double edged sword because it doesn't spur the economy either, but now they have to build their credit back up. Hopefully we just all learned our lessons and won't spend more than we can afford.
jerry moore July 30, 2012 at 04:41 PM
While housing was part of the problem, it is also not the solution. In years past you had to have GOOD credit in order to get a loan. Then during the "Bush years" credit became easy and the good times rolled. Basically what happened was that people over bought because of the easy money. As someone in Real Estate you surely must know that the way it used to work was that you bought a starter home. Then when you had children you moved up a bit. When those children where gone you either down sized or even upgraded some more. That all changed with the easy money period of the 2000 - 2007 period. Banks and Government created this problem. My home that I bought as a starter home 20 years ago is once again a starter home today. Sorry to say but this glut of homes will be around for a while
odonovana July 30, 2012 at 04:49 PM
First off we need to all realise that the way it was didn't work and not hanker back ,we need a fundamental reappraisal of capitalist consumerism and business ethics otherwise we are destined to repeat our mistakes .Our primary goal must be to get people into sustainable and meaningful employment where hard work ,enterprise and duty of care is encouraged and rewarded .
1stknightrealty.net July 31, 2012 at 02:57 PM
I think all of us have learned "much needed" lessons on what is important. Even some of the richer people I know are cutting back and spending less than they did a few years ago. In the long run, that will be good, but in the short run, we need some of the more financially stable among us investing in real estate. It is certainly more predictable today than the stock market because prices are so low, they have to go up. I truly believe in Northeast Atlanta as the place to be in the years to come.
Karsten Torch July 31, 2012 at 03:22 PM
Jerry, you're being silly. If we let the market choose winners and losers, then what power does Washington yield? How can anybody put their cronies in power and keep them there? If we hadn't saved GM at the cost of billions to the taxpayers, how could we have put the Union in such a good position and made sure they were well rewarded for the failure they created? Then where would the votes have been? On a serious note though, you're exactly right. Government needs to get the hell out of the way. We need to keep the tax cuts and make them permanent, which would provide some stability. We need to do away with corporate income taxes completely. This would help bring jobs and manufacturing back to the US. And in the greater scheme of things, wouldn't cost the government a dime. Actually, it would help increase revenue from the additional incomes it would create. A consumption tax, like, say, the FairTax would really be the way to go, but since that's not going to happen right now, we'll stick with the above....
1stknightrealty.net July 31, 2012 at 05:35 PM
Karsten, I really like some of your ideas. My opinion is the ONLY WAY we will get some of these businesses back in the U.S. is to eliminate corporate taxes. That would not reduce the revenue to the government--in fact, quite the contrary. it would increase revenue to federal, state, and local governments because it would create jobs!!!! Just as "foreclosure prevention programs" cannot help people who do not have a job, the federal, state, and local governments cannot raise tax rates enough to compensate for what working Americans could pay in taxes. If they are drawing unemployment, getting food stamps, etc, they can do little to contribute to our economy. In addition, our young people need parents to "show them" how to work and not depend on the government for existence. The future of the U.S. can be very bright but we have to get back to limited government.
Karsten Torch July 31, 2012 at 07:22 PM
And I've said this before in other blogs and threads - the corporate income tax serves no purpose. Other than to provide a way for some to attempt to punish corporations. The same people that push for higher income taxes for these companies are the same that say corporate personhood doesn't exist. If you think about it, what is the effect of corporate income taxes? Simple answer - reduces profits. Raises prices. Limits growth. There's only three things a company can do with money it makes. 1) Taxes. 2) Infrastructure - including software, hardware, buildings, maintenance, whatever. 3) Income for employees, either in salaries, wages, or bonuses. That's it. Those are the only way a company can disperse and money it makes. Both of the second ways are taxed. And higher than corporate income taxes with all its loopholes. And closing loopholes will only serve to raise the tax rate, in effect, so that would do nothing to bring new jobs.

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