1) Encouraging savings (less spending by the consumer) is a great approach for all of us, except that it stands to slow the economy and reduce current tax revenues. It also rewards those that have more to invest. These “investors” racing to government backed vehicles would be pulling capital out of American corporations causing job loss and a secondary ripple effect that would continue to slow our economy (besides not being able to find lender due to the un-rescued banking meltdown)

2) Having ‘do-good’ government works programs requires money to pay for them, as well as more government officials to manage a bigger Federal government — more borrowed money or taxing more. Although it could be pointed out that its not going to cost $700 Billion, yet it would still be expensive to fund these “social” programs. Critics would point out that whatever it costs, the money would not be returned as in the current rescue/bailout plan. (I think “bailout” is the term that turned many off yesterday)

Don’t get me wrong, its great to hear these alternative thoughts, but I do think it is naive to see the answer quite as simple as biting the bullet now and facing a depression. A concern worth thinking about — are American more or less capable of handling a depression than we were in 1929? My answer is less … more Americans in that generation knew how to live on less and were more likely to help their neighbor than today. Many of our citizens were far more self-sufficient that suburbanites and urban dweller today … not to mention the much larger population. Let’s avoid a depression first, then pressure for change in our lending practices. (watching congress try to make a change in lending practices and lobbying back in 2004 is enough to make one cringe: http://tinyurl.com/429na9 )

Great piece. Thank you.