View Single Post
  #97  
Old Posted Aug 3, 2010, 2:01 AM
pesto pesto is offline
BANNED
 
Join Date: Jul 2009
Posts: 2,546
Some pretty interesting points. A couple of comments:

The stimulus package was an almost complete waste of money. Essentially no effect since the public (quite rightly) is too scared of what the government might do next to start spending any money they earn. The biggest US companies and I have one thing in common: we are hanging on to our cash until the next election restores some fiscal rationality and a consistent economic policy. That's just about all a government needs to do.

Having said that, large projects would have made even less sense since the idea of the stimulus (erroneous as it was) was to pump money into many places very quickly so as to stimulate current spending. Large localized projects don't accomplish that.

Tax cuts tend to go to a mixture of reduction of debt (which is net saving) and spending. This is likely to translate in stronger long-term growth. One could argue that this was a last ditch effort to bring the US back to world competitiveness instead of encouraging spending and paying for it with debt, which certainly hurts the long-term economic welfare.
Reply With Quote