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Monday, February 17, 2014

The Stimulus Success

Calculated Risk (aka Bill McBride):

The Stimulus Success: It is important for the future to set aside ideology and recognize that the American Recovery and Reinvestment Act of 2009 helped the economy.
The stimulus could have been structured differently, for example, why have tax incentives for businesses to invest when their is already too much capacity? And research suggests the cash-for-clunkers program was not very helpful.
And more importantly - knowing that recoveries from financial crisis are slow - investment in infrastructure could have been larger and lasted longer (not just "shovel ready" programs).
It is the details that should be debated - understanding what worked and what didn't work would be useful during the next financial crisis (when the next generation of financial wizards think they've discovered how to turn lead into gold) - but overall the program was obviously helpful.  ...
It is sad today that extremist ideologues are arguing the stimulus failed. This is very dangerous for the future. ...
We should debate the actual impact of the stimulus. We should debate the effectiveness of each component of the stimulus. But we should also ridicule the ideologues ...

    Posted by on Monday, February 17, 2014 at 02:03 PM in Economics, Fiscal Policy | Permalink  Comments (77)


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