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I did leave out the $200b or so of tax cuts ... but apart from the tax cuts that were originally promised before the full extent of the economic crisis became clear, the rest were just the political cost of the obsolete institution of the filibuster and of the PAYGO legislation (which was obsolete on passage).

The magnitude of the borrowing with "hoped for recovery" does show the challenge in getting actual stimulus done.

As to why the stimulus spending should be government spending rather than private spending ... we live in an economy where 2.2% of spending on GDP is federal government, non-defense spending, and 70% of spending on GDP is consumption spending. IOW, as JK Galbraith pointed out long ago, an economy of private affluence and public poverty. For a large number of the actual stimulus spending programs, the long term payoff really is substantial.

And it is really important for the US government to get back to the Hamiltonian system which served us reasonably well from 1790 to 1970 of the government investing in infrastructure that would support the development of new industry. Gaining the ability to do new things, and the ability to do the things we are presently doing better, is quite urgent, after a decade of reversing course and over two decades of heading rapidly in the wrong direction.

I've been accused of being a Marxist, yet while Harpo's my favourite, it's Groucho I'm always quoting. Odd, that.

by BruceMcF (agila61 at netscape dot net) on Sat Feb 28th, 2009 at 05:40:52 PM EST
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