I have been giving some thought to and doing a little digging relative to the current boom of our economy. I came up with a few questions that give me pause. At what point will the economy plateau or turn south? The truth is I don’t really know the answers to most of these questions. Also, please forgive my grammar and punctuation.
Since an increase of corporate earnings is reflective in part by price increases, won’t there inevitably be a rise in inflation thus interest rates? If the interest rate rises, won’t that cause there to be too much consumer debt especially with large financed purchases such as housing? What will be the long term effect of the surge in refinancing?
Can the domestic capital and development investment boom continue indefinitely?
What long term effect if any, will the NYSE’s activity with regard to investment into international markets have on American investment?
With the proposed new tax plan and supposed reduction in deductions, won’t the real net percentage that corporations and other large businesses pay actually increase as opposed to the benefits of deductions and loopholes they enjoy now? If there is significant tax savings for corporations, won’t companies use a significant amount of the money to pay dividends to their shareholders? Since the earnings per share wouldn’t be adversely effected, won’t a significant number of businesses move the cash from the reduction of their tax liability offshore or increase their investment in the often lucrative foreign markets? Who is going to pay the difference in the lost tax income? Taxpayers? Will we just throw it into the bucket along with the rest of our rapidly growing deficit? How can conservatives support that or better yet, why would they?
How can the repeal of tax deductions such as the elimination of the 401k deduction or the repeal of the so unpopular estate tax possibly help the middle class? There is an example used by some in government who say that the repeal will benefit the working class and their families. Frequently they refer to the property assets of the multi generational farmer. Don’t most people that have that much debt free property set up trusts or include their kids on the titles in order to avoid the death tax? The truth is the estate tax doesn’t effect the mom and pop family business owner who has less than five million in assets. Isn’t the repeal only meant to benefit the wealthy?
Isn’t the export of jobs more reflective of lower labor costs and almost non existent regulations, not taxes?
Don’t large companies like Amazon realize more significant tax breaks directly from the states and municipalities that attract them to operate within their borders? Isn’t the decision of many companies on where they call home effected significantly by being able to operate and manufacture in states that don’t have organized labor?
Since the trend of growth in new jobs requires retraining of existing labor forces, wouldn’t there be a significant number of workers who can’t afford to be out of work while they are being retrained? Won’t those effected end up having to work in jobs with employers such as Walmart or McDonalds that offer a fraction of the pay that they are accustomed to. Wouldn’t this reduce the number of workers who would otherwise make up the middle class?
Doesn’t the federal labor statistics reflect such employment as growth regardless of the pay. Also, don’t these statistics not take into consideration those who are no longer looking for jobs and are depending on social programs such as welfare to exist? Does the national drug epidemic have a significant effect on the pool of sober, responsible labor, especially in areas with a high rate of unemployment? Doesn’t that mean that there are places in America that have good paying jobs but can’t find qualified people to work? I don’t understand why an unemployed coal miner in Virginia doesn’t move his or her family to places like Montana where there are jobs. Isn’t that the whole plot of the story in the book Grapes of Wrath?
What will be the effect on the economy as a result of the diminishing number of retail brick and mortar companies? Doesn’t this put states and cities in a major bind trying to collect taxes from sources like online stores in order to close the gap caused by the lost revenue from failed retailers? What about the impact on jobs?
It has been said that the GDP and number of jobs will grow as the storm and fire ravaged parts of the country are rebuilt. At some point, won’t this growth tail off especially within the building and supported business sectors as a significant number of the projects are completed?
Aren’t most of these projects being paid for by insurance companies? Won’t that generally increase insurance rates thus mortgage payments throughout the country?
Some in the current administration and congress are touting the increased number of jobs within industries such as coal, pipeline construction and numerous other industries. Since the coal industry will no longer be able to provide any significant additional employment and most of the pipeline jobs will disappear when such projects are completed, what effect will this reality have on the confidence of American’s who believe and have been promised that many of these jobs will become available, pay well and provide long term employment? What will be the effect on the economy?
How will a trade war with countries such as China work? How can you force them to either buy more from this country or be levied taxes and tariffs that will mostly have a negative effect on American companies? Isn’t it true that a majority of the products produced in places such as China are imported by companies big and small who basically provide specs and designs and have places like China produce and package them? Isn’t that what “Made in China” on the labels really means? I don’t think I have ever seen a Chinese car or authentic Chinese tie or pair of shoes.
Speaking of ties and shoes and totally off the subject, most people don’t know that if you buy a few pallets of basic varietal wines from some producers, they will be happy to slap your label on the bottles and you can call it your own brand. Imagine where that thought came from. While I’m at it, most people don’t know that a significant number of Chinese and Teriyaki restaurants in this country are operated by Koreans. Ok, I’ll get back on track.
Am I off base or doesn’t the logic ring true that foreign manufactures such as Toyota build a significant number of their products in the US mostly because of the better quality, technology and other factors including shipping expenses? For their foreign customers, isn’t it also cheaper to export them from here rather than export them to here? By building them here, don’t they attract buyers who see “Made in America” as an important consideration for their purchases? Wouldn’t it be true that export tariffs wouldn’t make much of a difference in their decision to produce in the US? Wouldn’t these new expenses simply show up on the window sticker?
I may totally wrong but doesn’t the US owe a ton of money to the Chinese for the bonds they were required to accept in past trade deals? If so, what if they wanted to collect?
Isn’t there a “put up or shut up” component with regard to investors in the stock market and everywhere else? If congress and the administration don’t deliver as promised, won’t that change the entire picture of our economy? If they do, how long will things continue to be rosey?
What happens to our market based economy when important regulations are reinstated in the event that there is a change in the congressional and presidential majority? Isn’t it true that most Americans have yet to feel the effects of the recent and significant wholesale repeal of regulations including the very important ones related to our environment?
What will happen to our economy when the global markets become infected by the lack of our government’s ability to recognize important rules and traditions?
This includes article one section seven, clause 2 of our constitution titled “from bill to law” which in spirit is designed to force bi-party discussion and compromise supported by thoughtful, meaningful and written contributions based on a knowledgeable interpretation of legislation by our President?
Am I wrong or doesn’t decisions to support or reject specific legislation over dinner, on the golf course, through the advice of extremists and conspiracy theorists or on social media show a deliberate dereliction of these provisions?
I could go on for days. Some of these questions and comments may be far fetched yet I strongly believe there will have to be a tipping point…at some point.
What do you think?