There is a lingering fear that the second Great Depression is coming. History repeats itself and somewhere out there in the future that second Great Depression is waiting for us. The American economic machine seems too big to fix and we've ridden too high a wave for too long. However, we can't let this fear paralyze us and we can't ignore the apocalyptic signs.

Consumer spending is dropping fast and therefore demand is falling. Some businesses like Microsoft and Boeing are laying off workers by the thousands, while others like Circuit City and Washington Mutual are instead dying.

To push demand back up Obama signed his $787 billion stimulus bill into law on Feb. 17.

Hopefully this is not the last step toward economic recovery as America is likely to need more than just $787 billion to get out of this mess and the government should spend enough so that our economy is secure, even if it means a higher debt in the future.

$787 billion is not enough

"Today does not mark the end of our economic trouble. Nor does it constitute all we must do to turn our economy around" said Obama when signing the bill. He later expressed that a second stimulus could be coming to further help the economy, according to the New York Times.

It's good that Obama is thinking about a second one because this one probably won't be able to turn the tide on its own. The US should try to spend additional money past the stimulus until we are closer to our regular GDP.

The Congressional Budget Office estimates a 2 trillion dollar gap in our budget and that our GDP would've fallen about 8 percent next year without intervention. Because money flows and can be spent multiple times (every time it is spent it is in the hands of a new consumer) the government wouldn't have to spend the full 2 trillion to bridge that gap, but economists remain skeptical that $787 billion is enough.

The unemployment rate will continue to increase to 9 percent, although that is about 2 percent better than it would've been without the stimulus, according to Mark Zandi, an economist and co-founder of economy.com.

It all depends on the private sector's reaction to the influx of money, said Dongwa Hu, an economics teacher at EvCC. If confidence increases and consumer saving decreases then the stimulus might be enough of a flow to turn the economy around.

Few can predict how humans will react accurately, however it certainly appears that the $787 billion is not going to be enough spending to boost the economy up to healthy levels. And even if the current spending is enough, the government should take a better safe than sorry approach. It is better to be slightly more in debt in the future than to have a depression right now.

Bipartisanship is not necessary

Obama promised bipartisanship in his election campaign and he may indeed be trying to change the way politics is done. This goes along with how most Americans seem to believe that the moderate way is always the best way. However sometimes partisan views are correct and right now the democrats have to ignore the republicans.

"Bipartisanship probably shouldn't be the primary goal right now. The moderate response is nonsensical, if you want to get out of the recession you're going to have to spend more," said Steve Horn, a political science teacher at EvCC.

Most liberal and conservative economists support the stimulus according to Horn. "But that doesn't mean there aren't political arguments, which are mostly coming from republicans," said Horn.

If the republicans want only to cut taxes or want to do nothing and let this recession sort itself out, the democrats shouldn't compromise with them. It might look good in the media to be cooperative but it wouldn't be what's best for the country.

Government spending vs. tax cuts

The two methods a government can use to increase consumer spending are government spending and tax cuts. However, government spending is the better method for a variety of reasons.

To begin with, government spending is more efficient than tax cuts.

What I mean by this is if the government spends 5 billion businesses are going to immediately see an increase in demand by 5 billion. However if the government gives 5 billion in tax cuts that money begins at a consumer and they will save instead of spend a certain amount of that money.

To make matters worse the amount people save usually increases during a recession. In the US the saving rate went from 0.2 during the first quarter of 2008 to 2.9 during the fourth quarter according to the Seattle Times.

For each dollar lost on tax cuts our GDP will increase from about $0.25-1.22, however for each dollar the government spends our GDP will increase by about $1.38-1.63, according to Zandi.

Secondly, a tax cut for businesses doesn't help demand much.

"If you cut taxes for businesses they aren't going to increase production or hire more workers, because the demand still won't be there," said Horn.

Lowering the production costs might help if the cost becomes deflated, but America companies rarely deflate their prices. It is more likely to boost corporate profits without helping increase demands.

Finally, tax cuts won't help pay for education, infrastructure, or get us started toward more renewable energy, but government spending will.

"Now is a good time for the government to get things right, to do a lot of capital spending that should've happened a while ago" said Hu.

We want our schools to keep our quality teachers, we want to repair our bridges and highways that are in disrepair, and we want to increase our renewable energy infrastructure. All of these things take a huge investment by the government so what better time to start these projects than when government spending is needed by the economy?

The National Debt

The latest talking point of the republicans is that spending so much now is "generational theft." If there is one thing to do right now, it is to stop worrying about the national debt. It's not as big a problem as you might think and it's won't be as big a burden as a depression would be.

People hear about the national debt reaching 10 trillion and are amazed at how much America owes. However if you compare our debt to our GDP America has less debt proportionally than Japan, Italy, Germany, France, or Canada according to the CIA World Factbook.

Also, 75 percent of the debt is inside the US, according to Hu. This means that Americans are paying the debt; however Americans are also getting paid. So the money is staying inside the country and flowing within our economy.

Not to say debt isn't bad.

The tax burden on the future will probably be higher, said Hu. While Americans get paid back for their investments, usually only the rich can invest. Because there is a sharing of the tax burden, but only the rich get a return on investment, the gap between the classes will increase.

This depression is happening now. If we do nothing it is going to be a huge problem for many Americans. The struggle of a somewhat higher tax burden in the future will be an easier load than the struggle of a depression now.