Drs. Steven Van Der Ploeg and Peter Crabb are debating the stimulus bill, and dueling it out in the Idaho Statesmen. The U.S. Senate and House of Representatives recently passed their own versions of a stimulus bill, and Congress is now working for a compromise to place before President Obama. Our own two professors of Economics and Finance wrote opposing views of the stimulus bill, each begun in this blog and linked to the Idaho Statesman. Who do you side with and why?
The Stimulus Bill Will Provide the Jolt That Is Needed
Dr. Steven Van der Ploeg
The stimulus plan is a good idea. Well, relative to what, you ask? And the answer is: relative to no stimulus bill at all. Why might it be better to do nothing, which some people advocate? Because the economy is losing jobs at an accelerating rate. The unemployment rate is now 7.6% (12.6% for African-Americans); half of 3.6 million jobs lost have occurred in the last 3 months. Many people, through no fault of their own, are without employment, and will experience the personal and social costs unemployment. Among these are anxiety, family crises, divorce, homelessness, crime.
More at http://www.idahostatesman.com/business/story/665298.html
The Stimulus Bill is a Bad Idea
Dr. Peter Crabb
This week David Axelrod, adviser to President Obama, said, “The American people are desperate for us to act.” So the U.S. Senate passed its legislation this week, and the compromise bill with the House is likely to come in around $800 billion. We are not that desperate! First, the U.S. government already can’t afford it. Federal tax revenue declined nearly 10 percent in the first four months of the fiscal year.
More at http://www.idahostatesman.com/business/story/665297.html