AFTER "VETOING" THE ECONOMY INTO WEAKNESS, GOP NOW READY TO SPEND
If you want "Republican-lite", it appears you need to talk to Larry Summers, these days. If you want a new direction, think outside his box.
Consider this: providing health insurance benefits to kids is about a $32-$40 billion dollar effort, over five years.
A targeted, relief program like the one that Bush vetoed, could provide direct relief over 15 years to those who could use it, at the levels of "stimulus" that the President is proposing ($150B) for one year to prevent a total wipe-out for the GOP this year in November.
I pick on Larry, because the recent tomb from Brookings, that is getting parroted all over by Party Officials, bears his namesake (by inclusion, not authorship). Also, he's written about the glory of tax cuts, recently.A targeted, relief program like the one that Bush vetoed, could provide direct relief over 15 years to those who could use it, at the levels of "stimulus" that the President is proposing ($150B) for one year to prevent a total wipe-out for the GOP this year in November.
In turn, then:
On "Timely": This is all just written by academics.
In the real world, markets are forward looking. Next-period activity matters just as much, if not more, than current period activity. Thus, in terms of managing doom-and-gloom, which is the confidence spiral that policy response arguably is best suited to finagling because of its deep pockets, large spending projects "just around the corner" are arguably just fine. Schools, airports, bridges - why not?
Confidence is key. Giving out depreciation tax breaks doesn't imply that businesses will hire people. So what if you can write off all your equipment purchases? Without the sense that the business is going to grow in the next period, why hire people with the "saved" money?
On "Targeted": If there is an energy price "shock" to the economy, no amount of "targeting" is going to fix it, unless it also fixes the shock, so let's not pretend that we can target something that cannot be. That includes monetary policy. We can help with the adjustment costs, and that is all, which includes unemployment relief, mostly, as those thrown out of work are forced to regroup. Give judges the temporary ("emergency") authority to reschedule mortgage debts - who better to review evidence and to decide. on a case-by-case basis, whether loans given were quasi-predatory or not?
The idea that general income tax cuts are obviously warranted is just short of bizarre.
True or false: Republicans stonewall, Democrats roll over. After having lost his AMT battle, for now, Rangle rolls for Republican-lite stimulus, including breaks for business.On "Temporary": This advice is "targeted" to the Republicans, who passed out a structural solution, last go round, to a cyclical problem. In terms of reigning in GOP politicians, then, "temporary" is much needed (and a smooth bit of do-as-I-say-not-as-I-do when it comes from their mouths). They certainly haven't "paid back" the debt at the top of the cycle, either from their last stimulus plan or from their tax-cut-and-spend routine.
In terms of keeping confidence, "temporary" is wrong. "Renewable" is probably better.
On that score, Americans can express their values and priorities in deciding how spending might occur. $150 billion dollars goes a long way. Any finite project would be pretty good, as long as their is a mix with direct relief dollars, too. (It certainly would fund ALL of Senator Obama's green energy projects, right, for the next 10 years?)
Size is important too. Consider this: providing health insurance benefits to kids is about a $32-$40 billion dollar effort, over five years.
A targeted, relief program like the one that Bush vetoed, could provide direct relief over 15 years to those who could use it, at the levels of "stimulus" that the President is proposing ($150B) for one year to prevent a total wipe-out for the GOP this year in November.
