Stimulus = Stopgap
Posted in Main Blog (All Posts) on January 6th, 2009 5:36 am by HL
Stimulus = Stopgap
WASHINGTON — We should resist the temptation to see the forthcoming “economic stimulus” package as a panacea. It won’t be. At best, it would represent traditional “pump priming.” This familiar metaphor is worth pondering. To get the pump started, you add water; then the pump operates independently. Similarly, the stimulus will succeed only if the economy resumes spontaneous expansion and job creation. The incoming Obama administration has understandably focused on the immediate task of designing the stimulus program. It has said less about how it would encourage self-sustaining economic growth. But that, in the end, is the crucial issue. Ever-expanding government budget deficits — reflecting spending increases and tax cuts — would ultimately be ineffective and self-defeating.
Obama Faces World of Conflict
At 12:00 noon on January 20, the United States will have experienced sixteen years of contentious, divisive, and mediocre government. This bleak period has been evenly split, to the day and hour, between Democrats led by President Bill Clinton and Republicans led by President George W. Bush. That dismal record will test President Barack Obama, who takes office that day, as much or more than the economic recession, the issues of immigration, energy, education, and health care, the bog of Iraq and Afghanistan, the eruption of conflict between Israelis and Palestinians, and a litany of difficulties that almost any schoolboy could recite.
