You don't have to be an economic genius to understand how idiotic your statement is. First, this was one of the biggest tax cuts in US history, on an annual basis. It delivers a significant amount of cash to every working man and woman in the country on a weekly or biweekly basis. Most of that money was pumped back into the economy and that is what stimus is all about.
The Stimulus Plan: The Tax Cuts - ProPublica
There's all the tax credits in the stimulus package. A hefty list isn't it? But a list like this doesn't spur real and serious GROWTH, most of it are just "giveaways." These "tax credits" were nothing more then government trying to direct where the resources are allocated. The Making Work Pay one, giving people an extra $50 in a paycheck, isn't going to spur a lot of GROWTH because the guy was BROKE before the $50 and he's BROKE after it.
The way you spur growth through tax policy is through cutting taxes across the board FOR THE LONG TERM and let individuals determine how to spend the money. Doing serious supply side tax reform to spur serious business investment creating new businesses, etc., gives people longer employment with higher wages. THAT is the only thing that will spur growth through tax policy.
It's pretty clear that you don't understand what stimulus is. Stimulus is simply government spending to boost economic activity.
Stimulus is not simply that. Stimulus is monetary and fiscal policy manipulation, let's not just focus on the fiscal side okay? With monetary policy the Feds will manipulate interest rates by sending them through the floor because that's supposedly going to encourage growth and expansion. With fiscal policy you have the government deciding they are going to spend to take up for the decrease in demand in the private sector. BOTH of these policies have been used since 2009 and NEITHER have worked. Housing is still horrible, so the only thing that lowering interest rates to next to nothing has done has hurt savers. The government spending hasn't done anything either, where if you had ANY level of economic understanding, if you just break down what's IN the stimulus package you can see that NONE of it spurs growth. The only part of the stimulus that was decent was the infrastructure related projects as mentioned, but these projects aren't things you can just start up in a month, it takes years in most cases.
We freed up the credit markets to keep credit flowing, THAT'S ALL we should have done. We would be a much better place right now because the central cause of the recession would have been "somewhat" solved (the financial markets), and we could have allowed housing to bottom out to then start swinging back. REMEMBER, the housing market was pumped up through a lot of hot air speculation and all of that hot air needed to get the hell out of it. People that bought houses they couldn't afford and signed up for mortgages they didn't understand, politicans that wanted "every American to be a homeowner," and Wallstreet looking for anyway to increase a profit. All of that hot air needed to get the hell out of that system, so this day (even with LOW INTEREST RATES) the housing sector is still struggling. ADD on top of this, despite the low interest rates, it's harder today than ever before to get APPROVED for a mortgage.
Implementing significant austerity measures now would almost certainly send the economy back into recession, as has happened in many Europen countries that went to austerity too soon. The end result would be higher -- not lower -- debt.
Okay AdamT, how do you pay for it? You don't want austerity right? You want more stimulus (even though the sh*t hasn't worked), how do you pay for it? We are $16 trillion in debt and running in the red, by 2016 we will be at around $20 trillion nearly in national debt just going on the pace we are now. Okay, so what do you want to be at, $25 trillion or $30 trillion by 2016 instead? I mean, why don't you take your liberal glasses off and see this country is in a HORRIBLE financial hole at the moment and all of the spending NUMBER ONE isn't producing high growth periods and NUMBER TWO is about to BANKRUPT us. Can't you see that man??
They obviously did underestimate the recession as unemployment went higher with the stimulus than they thought it would go with no stimulus. This is pre-economics 101 stuff.
This is the problem with you liberals, you think because your liberal economics professor encourages Keynasian principles in college that you need to come out here and spread that sh*t. The stuff doesn't work, it's not working. We are going into $20 trillion in debt by 2016, we are growing at 1.9% with 8.2 unemployment and fewer jobs being created. Why don't you see that we need GROWTH policies to be implemented and the ONLY sector that can save us is the private sector?
If government would just BACK OFF, we would be a lot better:
- The lower interest rates have done nothing but hurt savers, nobody can even get approved for the financial products and the housing sector is still down
- The stimulus package didn't stimulate a damn thing, the tax credits were nothing but pet projects that liberals had been wanting to do since 1975 and this was just an opportunity to do it
- The healthcare bill is making it harder to hire
- Unemployment extensions discourages a good chunk of people from taking available employment, they are sitting by milking the system
IF YOU TAKE THESE POLICIES AWAY, we would be at LOWER UNEMPLOYMENT TODAY (I estimate 7.2%) with less debt and a higher growth rate.