Wednesday, January 28, 2009

Economists who do not support massive debt for pork aka Stimulus

There are many economists who disagree with the stampede for a massive "stimulus." Massive debt to pay for massive pork didn't work in 1929 - it caused the US to have a far worse depression than Europe - and won't work now. Cato instutute - Fiscal Reality Central:
Notwithstanding reports that all economists are now Keynesians and that we all support a big increase in the burden of government, we do not believe that more government spending is a way to improve economic performance. More government spending by Hoover and Roosevelt did not pull the United States economy out of the Great Depression in the 1930s. More government spending did not solve Japan's "lost decade" in the 1990s. As such, it is a triumph of hope over experience to believe that more government spending will help the U.S. today. To improve the economy, policy makers should focus on reforms that remove impediments to work, saving, investment and production. Lower tax rates and a reduction in the burden of government are the best ways of using fiscal policy to boost growth.

2 comments:

John said...

It doesn't matter. The goal isn't to improve the economy. The goal is to appear to be doing something to improve the economy.

Later, if things don't improve, announce that things would have been worse still without what you did.

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