Re: [Pen-l] Stimulus Porn: Commonsense Observations

[Robert Naiman <naiman@xxxxxxxxxxxxxxxxxxxxx>]

Is there any objective basis for assessing what percentage of the
stimulus consists of "special interest nonsense"? I think to ask this
because CEPR just put out a piece noting that everything the
Republicans have been complaining about amounts to less than 2% of the
package.

On Thu, Feb 5, 2009 at 6:38 PM, Michael Perelman
<michael@xxxxxxxxxxxxxxxxx> wrote:
> I do not pretend to be an expert on stimulus plan, but it seems to be too
> little, misdirected, too much infected with tax cuts, and filled with
> special interest nonsense.
>
> The Republican speak authoritatively as if tax cuts are the best way to get
> investment going, but real investment, the kind that results in the
> production of goods has been terribly anemic in spite of decades of tax
> cuts.
>
> I do note that one of the most direct ways during the recession is to
> eliminate costs, including debts, that hold the economy back.  Letting
> assets falling value raises the rate of profit, once the realization sets
> in that the asset prices have hit bottom.
>
> Leaving banks fail and writing off debts will cause some dislocation, but
> they will leave both the economy and society stronger.
>
> In terms of getting money spent, putting it in the hands of the poor and
> the unemployed seems far more reasonable likely to create spending than to
> give to the rich, who may just pump up asset prices once they feel
> confident, undoing some of the stimulus.
>
> In terms of public works, Gray Brechin, has been doing remarkable research
> showing how much the public works of the New Deal have contributed to the
> country to this present day.  The government has the opportunity to sell
> bonds at less than 3%.  Interest costs of public works represent a
> significant part of the total costs.   Taking advantage of the bargain
> basement cost of credit now represents a major savings, increased jobs,
> plus the opportunity to make a significant contribution to both the economy
> and society.
>
>
> --
> Michael Perelman
> Economics Department
> California State University
> Chico, CA 95929
>
> Tel. 530-898-5321
> E-Mail michael at ecst.csuchico.edu
> michaelperelman.wordpress.com
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-- 
Robert Naiman
Just Foreign Policy
www.justforeignpolicy.org
naiman@xxxxxxxxxxxxxxxxxxxxx
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