This from the NYT today really is insane:
Anxious over the ballooning size of the proposed economic stimulus package, now at more than $900 billion, lawmakers in both parties are working on a last-minute plan to strip $200 billion from the bill.
The effort is being led by two centrist senators - Ben Nelson, Democrat of Nebraska, and Susan Collins, Republican of Maine.
The problem with the stimulus bill is not that it is too big, but that it is, if anything, too small. History shows very convincingly that one big stimulus program -- to spur growth and change popular expectations -- is the best way to break out of a recession. A series of moderate or small packages just moderate a slump: things keep getting worse. Want an example of what can happen? Just look at Japan, whose equity markets dropped about 75% from their peaks (which of course is a rough proxy for other bad economic results like unemployment and declining incomes). Want a stock market down another 50% from where it is, and more unemployment, falling house prices, and declining opportunity? Keep it up Senator Collins.
There is nothing wrong with suggesting that stimulus money be spent on different things than budgeted at present -- indeed, the Republicans' botched execution of the first half of the TARP bailout is an example that money alone is insufficient -- but to suggest that less money is needed is to court disaster. |
