Thank you, I agree with you 150% couldn't have said it better myself. We the people should be referred to just as often as "yes we can".

Did you know a society may drown in its own wealth? http://en.wikipedia.org/wiki/Overproduction

That money is debt? (compare the different types of money supply to each other :) )

http://en.wikipedia.org/wiki/Money_supply#United_States

If money is debt, and overabundance can cause poverty, then perhaps "common sense" economics doesn't apply.

I would gladly make a large loan if i am already in debt, since I could easily use it to get out of debt.

Consider if I had a stupid son, who racked up debt on a few credit cards. You don't have the money to pay them off, and your son is a dependent. You could get a large loan, pay off the credit card debts and have significantly lower interest rates, then take whatever is left over and use it to buy financial instruments with a rate of return greater than the rate of interest on the loan, making a net profit. The housing market was like a dumb son, with improper hedging, and CMOs. Although the bail outs, loans, etc could of been better managed, they are like leveraging, or using debt to make money. Now, demand needs to increase, which means the government needs to make sure credit flow is good, among other things; which all means the cap, cut and balance thing would be highly problematic. Government needs to be flexible, improve progressive taxation(cause trickle down economics is a sham), and should cut things that should be cut, like the defense budget and not social programs which improve the quality of life of numerous Americans.

Spending isn't the problem, its the lack of it which is. The American people need to spend more, because then there would be enough demand for there to be jobs. First though, they need jobs. If the government spends their money properly, they could make or keep a massive amount of jobs. At the very least lessening the impact of the recession.

In the long run, our problems are ones of infrastructure and a recession will happen a few times every century in till a solution is found for our banking system and in-till information about the market becomes even more accurate, accessible and usable. Perhaps credit card companies or common retail outlets can make aggregated info on consumer spending publicly available in near real time, or social networks can be harvested for economic data.