Newly-elected President Barack Obama sure has his hands full with the current state of the economy. Inflation, Deflation, Energy, Credit, Housing is just the start of the economic mess in which Obama will inherit. Obama however has stressed the importance of Stimulus packages and these are two of the major one's and what impact they should have. First and foremost, president Obama wants to enforce a $1,000 emergency energy rebate to offset risign energy bills. Who will pay? The wind-fall taxes on oil companies such as ExxonMobil (XOM), Chevron (CVX), ConocoPhillips (COP). This plan is not that well planned. Currently if he were to send out Stimulus Checks it would go to 130 million eligible Americans. At $1,000 a pop that would equal $130 billion. This doesn't work out as the top five U.S. based oil companies made onyl $80.4 billion back in 2007. Plus the problem with energy relief is that it takes away the incentive for consumers to conserve which does not help long-term. So in the end this plan should get scrapped. The other stimulus is a $50 billion dollar job cut stimulus plan. This stimulus would help prevent cuts in various industries. Part of it would also prevent cutbacks in infrastructure and school maintenance. Obama claims this will save 1,000,000 jobs that would otherwise be lost. For specific, industries this will work but overall it won't have much affect as the Unemployment rate should continue to creep higher. Plus this doesn't even count the $1.5 trillion we are borrowing to help out the failing banks and Auto Industry. Estimates show the U.S. government borrowing over $2 trillion more than 13% of the GDP. At some point, Obama should release that the harms of borrowing insane amounts of money, even when in need, don't outweigh the benefits.
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