Thursday, February 05, 2009

Garbage, indeed.

Harvard economist Robert Barro calls the stimulus bill “garbage:"
This is probably the worst bill that has been put forward since the 1930s. I don’t know what to say. I mean it’s wasting a tremendous amount of money. It has some simplistic theory that I don’t think will work, so I don’t think the expenditure stuff is going to have the intended effect. I don’t think it will expand the economy. And the tax cutting isn’t really geared toward incentives. It’s not really geared to lowering tax rates; it’s more along the lines of throwing money at people. On both sides I think it’s garbage. So in terms of balance between the two it doesn’t really matter that much.
Atlantic article here. I am baffled by this thing. Please, someone, direct me towards the stimuli? As James Buchanan once insightfully pointed out, "the great flaw in Keynesianism is that it ignores the obvious, self-interested incentives of government actors implementing fiscal policy and creates intellectual cover for what would otherwise be viewed as self-serving and irresponsible behavior by politicians." Bingo. This bill is nothing more than a collective "load-blowing" of a Democractic party that spent the last eight years having too many of its wishes stifled by the Bushies. Unbelievable.