Sunday, February 8, 2009

Is it That Centrists Don't Understand Stimulus or Don't Care?

The compromise Senate stimulus bill has shaved $40 billion for state aid. This cutting was done to 'appease' centrist Democrats and Republicans who claim that this is not stimulus. Come again?

Stimulus requires quick and effective spending of borrowed money. States, constrained by law to limit deficit spending, are quickly cutting back on essential services. Federal money would immediately stop some of this cutting - it would get spend right away - and it would prevent cuts to enormously effective programs, like education - so it would be spent effectively. This is precisely what good stimulus spending does. In fact this is so effective that I think it should be priority number one. In addition, as I have said repeatedly, we cannot sacrifice our future prosperity by shortchanging our children's education. A good chunk of this $40 billion would have gone to education, which is exactly what we need most. So this $40 billion represented quick and effective spending for a public good that promotes future growth.

So are centrists just economically illiterate and truly just don't get it, or are they more worried about politics and perceptions in the midst of the biggest economic crisis since the great depression? Either one is inexcusable.

1 comment:

Jeff said...

Krugman agrees with you: