Friday, January 09, 2009

don't squib the stimulus

Congressional Democrats are complaining that President-elect Barack Obama's stimulus plan isn't bold enough. More importantly since he doesn't represent a district or state that might want money, Paul Krugman also believes this. Read his column here, but his key criticism is that "with both consumer spending and business investment plunging, a huge gap is opening up between what the American economy can produce and what it’s able to sell. And the Obama plan is nowhere near big enough to fill this 'output gap.'"

Obama recognizes the problem - as he said at George Mason University, "For every day we wait or point fingers or drag our feet, more Americans will lose their jobs. More families will lose their savings. More dreams will be deferred and denied. And our nation will sink deeper into a crisis that, at some point, we may not be able to reverse."

The numbers are bad and not getting better. Yes, this stimulus is a huge thing to contemplate, and yes it will suck to pay back the deficit. But unless the deficits run by former de facto President Bush and the Republican Congress, THIS deficit will in the cause of keeping people working and avoiding an economic meltdown, not designed to allow Bush's base - the elite - to renovate their vacation homes and buy new luxury yachts.

This isn't the time for being too cautious. Don't squib the stimulus.

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