Here are a couple articles that pretty clearly articulate where I'm coming from in the stimulus. Mankiw's article is all about going through the stimulus and making sure each item helps economic well-being. Barro's article is on the fallacy of government spending as a fix to all economic problems and how the main plan of the stimulus should be to provide incentives to work and produce.
(Barro and Mankiw are both Economics professors at Harvard)
"People don’t usually spend their money buying things they don’t want or need, so for private transactions, this kind of inefficient spending is not much of a problem. But the same cannot always be said of the government. If the stimulus package takes the form of bridges to nowhere, a result could be economic expansion as measured by standard statistics but little increase in economic well-being." - Mankiw
http://online.wsj.com/article/SB123258618204604599.html - Barro
http://www.economics.harvard.edu/faculty/mankiw/files/Is%20Govt%20Spending%20Too%20Easy.pdf - Mankiw
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Chris!
ReplyDeleteI'm taking microeconomics this semester and it's opening up a whole new world for me. I never knew you had a passion for econ.
Have you seen these?
SOCIALISM- You have two cows. The government takes one to give to someone else.
COMMUNISM- You have two cows. The government takes both and gives you the milk.
NAZISM- You have two cows. The government takes both and shoots you.
W'S NEW CAPITALISM- You have two cows. You sell one and buy a bull. The bull dies from hunger because all corn for feed is diverted to ethanol production. You attempt to create a new bull with stem cells from frozen cow embryos and produce only a new bull pancreas. Nevertheless, you declare "Mission Accomplished."
OBAMA's NEW CAPITALISM-???
What do you think?
BTW, Mankiw lives walking distance from me... not that I stalk him or anything.