Senators not so optimistic about a bipartisan agreement on the Stimulus Bill
It really looks like the Senate is having a difficult time finding a common ground between Democrats and Republicans on the total amount the Stimulus should be. Just like we were talking about in class, different Senators have different ideal points and it is all about finding that median point that is going to come out on top in a majority rule vote. Albeit a graph showing 100 Senator's indifference curves might be slightly more complicated than our examples in class, it is essentially the same idea, and worth reading the article now that we know the basics of how majority rule votes work.
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8 comments:
All this bantering while more and more people lose jobs, homes, and businesses. This is one time when senators need to shove their ideal points to the side and forget about an impossible condorcet point.
I'm extremely curious why this stimulus will help our economy recover. Didn't work for Bush so why should spending more fix it now.
Although I agree with Nathaniel on the urgency of helping the American public, I'm wondering the same thing that Jon is. I support the current administration more so than the former, but if it's taking this long to hammer out this deal, and if it wasn't a good idea in the past, what makes this the "be all end all" solution. Maybe we should look into other alternatives before jumping the gun?
This stimulus might work where bush's didn't because they should be structured differently. Whereas TARP basically just went to banks, the idea that should work is to put money into infrastructure spending - thereby hiring people to create the infrastructure and in the mean time upgrade the US so as our economy comes back we are prepared for the 21st century. Lets hope that is what actually happens, not some billionaires getting paid gastronomic sums on taxpayer money.
Investing in infrastructure will create jobs temporarily for a small minority of the American workforce. I really don’t think building more highways will save us from our economic perils. When you say upgrading what exactly do you mean? Is American still running on Windows 95? Perhaps a better idea would be to eliminate the stimulus plan and instead cut the federal income tax in half to give money back to the people. When people have more income they tend to spend it and that may prove far more effective at infusing money back into the economy.
Tax cuts are to blunt and unpredictable. It is speculated by many analysts that people will save their money instead of spending it and the people that do spend the money afforded to them through tax cuts cant be counted on to buy strictly U.S. goods which means money is flowing out of our economy. Under both scenarios we don’t make up for the massive slow down in domestic production. Govt. Spending is a more surgical approach and there is precedent that this approach works. i.e. the great depression and Japans lost decade. Look it up.
Tax cuts sound nice. Who doesn't want a big tax rebate? I know I do. That said, when you got your $300 check this summer did you go spend $300? Like most, I saved that money. And if I get a big tax rebate this spring? Saving it for next year's tuition. Tax cuts help personal wealth but do not instigate spending. Lack of spending is the biggest obstacle to the economy recovering. A healthy skepticism about the stimulus bill is warranted, but in words of an article I just read (about teaching) "we must proceed with caution, but we must proceed."
The tax rebate check some of us received was not necessarily a tax cut, it was a exactly what it was, a rebate. A true tax cut is a cut in the rate of taxes, be it corporate tax, capital gains tax, income tax, what have you. Guaranteed if Obama came out tomorrow and said that he was going to cut all the above tax rates, you would see the stock market, and the economy skyrocket. People do not need a short term fix, they need a long term stable ideology that will be able to spend and continue to spend in the future. And people being able to keep more of their money, and businesses being able to keep more of the money can invest, expand and employ more people. As for the Great Depression, all the government spending that FDR implemented, by force through threatening the Supreme Court, did not do as much as anticipated, or to this day believed. It was not until the United States entered WWII that we came out of the Depression.
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