Monday, January 26, 2009

Concerning Multipliers And Stimuli

Just a quick follow up to last week’s post concerning the unfortunate revival of Keynesian economics. See the two Wall Street Journal articles below for brief critiques of the assumptions underlying the current (and by that I mean panicked) stimulus mania gripping our betters up in D.C:

Government Spending Is No Free Lunch: Now the Democrats Are Peddling Voodoo Economics” by Robert Barro (and yes, this one is a repeat from last week)

The Stimulus Time Machine: That $355 Billion In Spending Isn’t About The Economy"

I remain firmly convinced that the decisions being made in Washington have precious little to do with economic realities, instead having rather a lot to do with political ideology (you know, like when then-candidate Obama admitted that raising the capital gains tax rate would DECREASE revenue to the Treasury, but that he favored doing so anyway in the interest of “fairness”). If not for political ideology, they make no sense whatsoever.

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