Monday, February 9, 2009

Welcome to Proptown U.S.A.

Elkhart, Indiana is the "white-hot center of the meltdown of the American economy" according to an October 12, 2008 Jennifer Steinhauer New York Times article. The piece painted Elkhart as a crime-ridden, desolate wasteland of hopelessness and desperation. Reading Steinhauer's article, you envision the bread and soup lines common during the food rationing times of the Soviet Union. Elkhart was the perfect prop for the Times to demonstrate to the country why "change we can believe in" was necessary.

What was Elkhart really like on October 12, 2008? It was bad. Not chaos and Marshall Law bad, but it was bad. It became bad because of 25 years of aggressive expansion in the RV industry which turned into overproduction and market saturation. This created a slowdown that began in late spring of 2008 and turned into complete stoppage by late October 2008, when bank financing dried up across the country.

Today, Elkhart has slipped even further. One person out of six is unemployed. Of those working, many have taken pay cuts to help their employer weather the storm. Manufacturing plants are experiencing cash crises as no sales in December meant no cash collected in January. The refusal of banks to loosen the credit reigns has contributed to increase bankruptcies and layoffs. Once again, Elkhart has become the perfect prop.
This time, Elkhart is putting a face to the need for government action the way that an emaciated child puts a face to the African charities advertised on late-night television.

But unlike the late-night charities that feed a family of four annually with 87 cents per day, the President is selling a plan to help the families of Elkhart with “a proposed $20 million minor league baseball museum in Durham, North Carolina; $6.1 million for corporate jet hangars at the Fayetteville, Arkansas airport; $20 million for renovations at the Philadelphia Zoo; and a $1.5 million program to reduce prostitution in Dayton, Ohio.” (taken from a recent CNN article)

A CBS News poll showed public support for the $1 trillion (when adding accrued interest and fees) stimulus has waned to 51%, down 12 points from January 11-15. The longer debate continues, the more details begin coming to light. President Obama knows this. When he says if we don't act quickly, irreversible damage could be done, he is more accurately speaking about the earmarks and pork contained in his initiative, not the American economy.

If you have heard the man-on-the-street interviews, you know those who speak out in favor of the bill are actually saying, "We need to do something." None of them are saying, "We need to spend $4.8 million for a polar bear exhibit at the Providence, RI zoo and $1.5 million for a water ride in Miami, FL."
Those things, along with the millions earmarked for STD's and ATV parks, may have merit, but they need to be debated in stand-alone legislation, not hidden in this emergency economic bill.

There are things the Federal Government can do to rev up the economy. The good people of Elkhart, Indiana do need help. It's shameless to use them as a prop to gain support for political payoffs and welfare handouts. Unfortunately, there is very little in this stimulus plan that will actually bring them back to work.

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