Re: [Pen-l] Democrats to placate Republicans on recovery plan

[Max Sawicky <maxbsawicky@xxxxxxxxx>]

State governments are likely to spend what they get to prop up
services that otherwise would take a hit due to falling tax revenue.
In that respect aid to states is one of the most efficient types of
stimulus, though there are limits to the amount that states could
absorb, and the distribution of aid makes a difference.



On Wed, Feb 4, 2009 at 12:05 PM, Doug Henwood <dhenwood@xxxxxxxxx> wrote:
>
> On Feb 4, 2009, at 11:59 AM, John Gulick wrote:
>
>> On this issue at least, I believe that Obama's courting of the Republicans
>> and sandbagging of the liberals does not spring from
>> some philosophical or political devotion to center-right bipartisanship
>> (although O may well be possessed of that), but rather from
>> his (and his team's) assessment that whatever package does get approved,
>> it will be nugatory in its stimulative effect.
>
> It's hard to believe that close to $1 trillion will be "nugatory." It's
> around 7% of GDP. And even with a modest multiplier, it approaches 10%.
>
> As for courting the Reps, Obama is shameless in that regard. But as a
> practical matter, even the wet dream legislation of Barry, Larry, and Tim
> couldn't get through the Senate.
>
> Doug
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