Stimulus””that is, fiscal intervention with the express purpose of speeding up the normal regenerative process that Grant describes””is unnecessary and almost certainly harmful, a policy based on hubris and anxiety, rather than on history and good sense. Under such circumstances, the proper way to analyze discrete proposals today for spending or taxing is on their own merits, not on their supposed ability to stimulate something else. There may, in fact, be a good reason for government to spend billions of dollars today on building highways, and it has nothing to do with stimulus. It is that long-term interest rates are at historic lows and that the right highways can boost the economy in the long term. There also may be a good reason, again far apart from stimulus, for revising the tax code and reforming Social Security and Medicare. It is that Americans now understand that the economic future is not so assured as they believed a couple of years ago, and it is time for decisions to be made””in a manner careful, sensible, and unstimulated.
James Glassman–Stimulus: A History of Folly
Posted in * Culture-Watch, * Economics, Politics, Budget, Economy, History, Office of the President, Politics in General, President Barack Obama, The Credit Freeze Crisis of Fall 2008/The Recession of 2007--, The Fiscal Stimulus Package of 2009, The National Deficit, The U.S. Government, Treasury Secretary Timothy Geithner
2 comments on “James Glassman–Stimulus: A History of Folly”
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I don’t recall Glassman objecting to fiscal stimulus during 2001, 2002, 2003, 2004, 2005, and 2006—when we did not need it and when it helped fuel a speculative bubble.
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As an aside, Glassman’s wife, Cynthia, was one of two ideologues who helped hobble the Securities and Exchange Commission at crucial points during the past 7 years.
[blockquote]I don’t recall Glassman objecting to fiscal stimulus during 2001, 2002, 2003, 2004, 2005, and 2006—when we did not need it and when it helped fuel a speculative bubble. [/blockquote]
Does that mean he didn’t object or you just don’t know about it?