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Originally Posted by pesto
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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.
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What on EARTH have you been smoking?
Leaving aside Obama vs. the Republicans, I seriously doubt you can cite a single example of tax cuts reducing debt (unless other taxes have also been raised).
I also seriously doubt that U.S. companies are going to hold onto cash for years rather than make investments now soley due to an Administration. Lack of investment now has been primarily due to 1) lack of lending liquidity brought on by the collapse of the financial system brought on by excessive liquidity and a lack of oversight, all of which was brought on by BOTH Bush and Clinton policies and 2) a complete lack of certainty over if and when the economy will recover, a question that is still up in the air not because of Obama, whose policies as they are in effect currently aren't materially different from Bush's, but because of item 1) and, partly, the national debt which will REQUIRE either an increase in taxes to balance or a default (real or virtual). Of the two, a tax increase is - by far - the better choice.
The debt is no more Obama's than it is Bush's or Clinton's. It is cumulative and responsiblity for it is shared by every Administration and Congress since at least Nixon. Any party that attempts to pin the responsibility on the other instead of facing the music and doing what needs to be done is appallingly irresponsible.
When debt hits 120% of GDP sometime this decade, we would no only have to stop adding to it, but to "grow" out of it back to a 40% level, we would have to not add to it and grow at 5% annually for about 15 years. Could that happen? Maybe, but it's highly unlikely that we could BOTH grow that fast AND keep our hands off the deficit button, no matter which party is in power. If we also ratchet down immigration at the same time (which, at times, both sides seem to favor), the chances of that sort of growth is even lower.
So quit supporting blowhards who try and blame all the evils on this administration or the last one, and start supporting people who actually support realistic policy. Which will, unfortunately, include tax hikes.
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