There is so much fog and uncertainty -- much of it intentionally injected into the debate -- about the different moving parts of the Stimulus Bill. But some of the broad outlines are arresting and straightforward. We're hearing all this talk about the staggering size of the bill. And it is a staggering amount of money. But according to Dean Baker, co-director of the Center for Economic and Policy Research, the amount of demand that the financial crisis is pulling out the economy is likely to be between $1.1 and $1.2 trillion this year (and that is not a controversial estimate). The Stimulus Bill (which, remember, is $800+ billion over two years) would try to compensate for that drop off with about $400 billion of spending and tax cuts. How efficiently the money is spent, how quickly and so forth -- all very good questions. But judged in these terms you start to see how the real question is whether any bill of that size is enough. David Kurtz and Baker discuss the issue in today's episode of TPMtv.From Collection: TPM Clips Added By: Talking Points Memo Tags:
The economy is tanking yet the stock market appears to be taking off again, the best evidence there is that the liquidity made available thus far by the bailout packages have not gone into productive new investment but rather into existing paper assets like the stock market. All efforts by Treasury, the Fed, and Congress are designed first and foremost to rally the securities markets and only secondarily to check the economic decline. As such, economic policy is par for the course, substantially emulating previous economic recessions. Only the scale is different. The political power of the financial sector is simply overwhelming and takes precedent over the real productive economy.
Tired of the dumbed-down public debate about the stimulus package? Progressive economist Dean Baker offers a bracing take on the underlying housing bubble, why the stimulus package is a good start but not enough to kick start the economy, and why things are likely to get worse before they get better.
There is so much fog and uncertainty -- much of it intentionally injected into the debate -- about the different moving parts of the Stimulus Bill. But some of the broad outlines are arresting and straightforward. We're hearing all this talk about the staggering size of the bill. And it is a staggering amount of money. But according to Dean Baker, co-director of the Center for Economic and Policy Research, the amount of demand that the financial crisis is pulling out the economy is likely to be between $1.1 and $1.2 trillion this year (and that is not a controversial estimate). The Stimulus Bill (which, remember, is $800+ billion over two years) would try to compensate for that drop off with about $400 billion of spending and tax cuts. How efficiently the money is spent, how quickly and so forth -- all very good questions. But judged in these terms you start to see how the real question is whether any bill of that size is enough. David Kurtz and Baker discuss the issue in today's episode of TPMtv.
Dean Baker gives you a pretty straight-forward assessment of the current state of the economy and his take on what the stimulus package's effects will be. Great reporting.
Your Daily Politics Blog: Tired of the dumbed-down public debate about the stimulus package? Progressive economist Dean Baker offers a bracing take on the underlying housing bubble, why the stimulu...