What Katrina, Rita mean for economy

In the past weeks, the region that has become my adopted home, the South has taken more than a beating. If by chance you have not seen the news, read a newspaper or heard by word of mouth, two hurricanes Katrina and Rita have brought great devastation.

The hard part will now be enduring the decisions and actions of man, or actually one man in particular, President Bush. In the face of these catastrophes, our President has been left with more than a little bit on his plate. The biggest portion on his plate now is the state of America’s economy.

Before Katrina and Rita hit, despite economic growth our nation’s economic forecast was not exactly rosy. To put it simply there has been more money going out of the Government instead of in. For one thing, there is the War in Iraq. This has been a huge expenditure that has for the most part yielded little if no return except for maybe the capture of Saddam Hussein.

I’m still wondering, where are those weapons of mass destruction? Then there are the tax cuts. While everyone hates taxes and loves a tax break, what people fail to realize is that taxes are a major means of revenue for America. This is what not only helps fund the war but more importantly entities like special interest programs and the educational system. While you may not be familiar with special interest programs, I’m sure you are more than acquainted with the educational system. Less taxes means in the big scheme of things, less money towards education, which fundamentally means that me, you, and your little sister and/or brother are more than likely going to receive the short end of the stick. But I digress, that is a topic for another day. The point is less taxes, means less revenue on that front. Now let’s jump to the borrowing that has helped to get this country to reach a deficit of more than $7 trillion, which is a new benchmark by the way. Now when I say borrow, I mean just that. Just like you have a student loan from Sallie Mae to help pay for school, America has loans from banks in foreign countries to help pay for what it feels are necessary expenditures, such as the war in Iraq.

On top of all of this, the Bush administration which inherited a $237 billion budget surplus, the largest in history, has managed to squander it and place itself back in debt. When you look at all of these factors, things don’t look quite so good do they?  Now let’s bring Katrina and Rita into the mix. Before Rita hit, it was expected over $200 billion dollars would be needed to fix the devastation caused by Katrina.

In the aftermath of Rita, this will do more than simply add to the tab. With Rita, oil and gas refineries, pipelines and drilling platforms have been shut down, with some needing months before they will viable once again. Also, key U.S. ports have been shut down which effects not only the importing of goods, but more importantly the export of them, which also effects economic growth.

I’m not suggesting that there will be a recession or even worse a depression, but it means that there will be an eventual economic downturn. For college students, particularly those graduating in the spring, this is not exactly the type of economic climate you want to start your fresh new adult life in and more importantly find a job in. For those of us not graduating in May, we are not out of danger either. When money starts getting tight in the government, one of the first ways they start to find more money is by cutting funding.

When funding is cut, education is usually one of the first targets. That means Grambling would potentially have less money coming its way and then so would so you. However, this chain of events could be prevented. It all comes down to Bush and what is going on in that brain of his. For those of you who don’t care for Bush, you need to hope that he uses his brain cells and comes up with a well thought out economic plan that is beneficial to all and not some( some being the rich). For those of you who are Bush cheerleaders, you need to pray that he doesn’t drop the ball again and land flat on his face.  So now I’m left pondering over one question: What will Bush do?