This week the House passed an $819 billion stimulus package in the hope that it will help create more jobs and slow the recession gripping the nation according to an article in the Dallas Morning News. Texas legislator Chet Edwards, who helped write the bill urged officials to pass the stimulus package because Texas is at risk of going bankrupt.
The article said:
“It’s important to pass this bill as soon as possible to keep Texas from facing the kind of economic devastation that Nevada and parts of California, Florida and Michigan are facing,” said Rep. Chet Edwards, D-Waco, who helped write the bill.
Edwards has a good point. Right now Texas is being hit by massive foreclosures, job losses and bankruptcies which are decimating the tax base. Foreclosures, job losses and bankruptcies create an environment where citizens are unable to contribute to the taxes necessary to run the state’s essential services.
California is literally facing bankruptcy and collapse. Something must be done to prevent the same thing from happening to Texas; but I’m not sure if the stimulus package will be enough to make the type of difference that is necessary.
Texas will only receive about 7% of this stimulus money and the package is estimated to only create 1.2 million jobs. How many of those jobs will go to Texans? Also, we can’t be sure how many jobs will actually be created by this stimulus package because so many companies are struggling just to avoid bankruptcy.
Are they going to hire more people while they fear going bankrupt? Or, are they going to continue to cut jobs as they try to save their companies from bankruptcy in this contracting market? A massive creation of new jobs may be to much to expect from this stimulus package. At best it may slow down the devastation.